12 Easy Steps to Help Your Repair and Increase Your Credit Score
Repairing your credit is not difficult. It does not take a long time either. There are some steps to help you fix and improve your credit score. You will then be able to get credit with lower interest rates and better terms.
Improving your credit score will allow you to have lower interest rates and better loan terms. This works if you are making a personal purchase or trying to get a loan to start a business.
Credit repair is not something you think about until you need credit. If you do not have good credit it may be tough to fix this overnight.
You need to begin to repair your credit now so it is fixed by the time you need it.
It is not hard to fix your credit score.
You will need to follow this process:
1. Review Your Current Credit Score
There are three bureaus you need to look at. They are TransUnion, Equifax, and Experian. They are required to provide you a free credit report once a year if you ask.
You can also use a free service such as Credit Karma to look at your credit score.
You will be able to review the information on your report.
2. Fight Negative Marks
If you found something that was not accurate, you had to write a letter to the credit bureaus. Now you can do this online.
Some things are going to have a bigger impact on your credit score than others.
If you have an account in collections and judgments, this is a good place to start. It is not uncommon if there is one credit application on your report.
You will need to click on Dispute and then select the credit to agree to remove this faulty report from my credit account. It can be fixed within a week.
You will need to dispute the errors with each credit bureau.
Some disputes will take longer than others to be fixed. Once you began the process, you are good. The credit bureau will have to investigate your claim and make a report on it.
If you can have these derogatory marks removed, this will improve your score.
3. Look at Incorrect Late Payments
Everyone makes a mistake. If you paid a bill, the company might have made a mistake and reported it late. The payment may not have been entered correctly.
If you dispute these late payments, you can see an improvement in your credit score.
Your payment history is a major factor in your credit report, so you will need to fix any errors.
4. Decide if you want to work with credit repair companies
You should dispute inaccurate information. You can also dispute accurate information.
If you have an account that went into collections and the agency gave up this will show up on your report. You can dispute this and sometimes you may be able to get it removed.
When you enter a dispute the credit bureau will need to see the information from the creditor. Some will provide it, some will not. They may ignore the request. If this request is ignored it will need to be removed from your credit report.
Smaller firms or smaller collection agencies are less likely to respond to this request. They do not want to be bothered. Banks and credit card companies are more likely to provide this information.
This is a technique that some people use. You can try this and hope that the credit does not respond.
This approach is up to you. It is something that people do and some credit repair agencies also do.
5. Be Nice
If you cannot remove something negative on your credit report or pay less money, you owed all is not lost. You should ask the creditor nicely if it can be removed.
Creditors can have the credit bureau remove entries at any time. For example, if you made a late payment and did not realize that you had a payment, you can explain the situation and ask that it be removed. They may agree to do so.
When in doubt, it does not hurt to ask if you are nice and polite.
6. Increase Credit Limit
The ratio of available credit impacts your credit score to the amount of credit that you have used. If you use more than 50 percent of your available credit, it will harm your score.
You can pay down your balance, or you can increase your credit limit. If you owe $2,500 and have a $5,000 limit, you can also increase your limit to $7,500. This will increase your credit score.
If you have a good payment history, you can call the credit card company and ask them to increase your limits. They want you to carry a high balance so they can make money.
If you do get a higher balance, do not spend this money. It will not help your credit score, and you will have more debt.
7. Open Another Account
To increase your credit score, you can open a new account. As long as you do not have a balance, this will increase your credit score.
Look for a card that does not have an annual fee. It would be best if you went through your bank, where you have an account. Cards with no annual fee may have a higher interest rate, but you will not have to worry about this if you do not carry a balance.
The goal is not to spend more but to improve your credit score. If you are tempted to spend, then do not open this account.
8. Pay down the Balance
If you had money to pay down your credit cards, then you may not be looking to borrow money.
If you decrease the amount, you owe this will improve your credit score. You may need to budget your money so you can have more to pay down.
This should be part of your financial goal. You will not pay as much interest and will be able to keep more of your money in the long run.
9. Pay on High-Interest Newer Accounts
If you have $100 a month to pay down your balances, focus on paying on the cards with the highest interest rate. After this, look at the age of the account. You should pay for the newest one, and they will increase the length of your credit. You will be able to pay off the high interest and improve your score.
Once you have that paid, then work on the next account. This will help.
10. Get Some Help
To get some help with your credit, you need to work with someone you can trust. For example, if your spouse has a great credit history, they can add you as an authorized user on their card. This will increase your credit score.
If they make a late payment, this will also show up on your credit.
11. Keep Older Cards
Your credit history and length has some impact on your sore. If you had a card for 10 years, and closing the account may hurt your score.
If you are looking to cancel any cards, get rid of your newest account.
12 Pay on Time
One late payment can decrease your credit score. It is important to pay your bills on time.
If you are not able to pay on time think about what you can pay late. A late payment on your mortgage or credit cards will be reported. It is unlikely late utility payments will be.
Choose the account that does not appear on your credit report if you are tight on money.
Over time your wallet and your credit score will see improvements.