Improving And Repairing Your Credit Score

The best thing you can compare credit repair to is weight loss. It takes time, it isn’t easy, and any quick fixes usually backfire. You need to be responsible, make real changes, and have patience. That said, there are a number of things you can and should do for improving and repairing your credit score.

1. Check Your Credit Report

The first thing you have to do is check your credit score, so you know where you stand right now and to check whether there are errors.

“Going without checking your credit score, or checking it every few years, isn’t enough. To have control over your credit and your financial life, you must check your credit score regularly.”

2. Have Payment Reminders

The next thing you have to do is always make any agreed credit payments on time. Hence, set up reminders on your phone or in your diary to make sure the money is in your account, and have those bills come out automatically. Do, also, make extra payments whenever you can because that looks really good.

3. Reduce Your Debt

Reducing your debt may sound hard, but it can be done. If you set those payment reminders and notice you have as much as a dollar more than you thought in your account, put that dollar straight towards any outstanding debt. Every little helps.

Other Important Tips

One of the things that really drops your FICO score is missed payments, although the exact impact will depend on your current score.

“The degree to which a late payment may affect your credit score can depend on multiple factors. When it comes to your FICO credit score, for example, a late payment will be evaluated based on how severe it is, how recent it is, and how frequently you’ve paid late.”

So, if you have missed any payments, make them straightaway. Do also make sure you’re not late on payments. The longer you wait, the more your score will be affected.

You also need to avoid your account going into collection as much as possible. This is because, even if you pay it off, it will still be on your credit report. Naturally, it will show up as being paid, but the mark would be there nevertheless. In fact, it will stay there for seven years. If you have legitimate difficulties, you need to contact your creditors about that as soon as possible. They don’t want you to have bad credit, they simply want to get their money back. And they know that, the worse your credit score gets, the harder it will be for you to pay for things.

Patience is also absolutely vital. The reality is that, once you have bad credit, you are likely to have it for at least five years.

“If you make a mistake or run into financial obstacles that result in negative items on your credit report, those derogatory marks will remain there for years. The good news is they will carry less weight in credit scoring formulas as they get older.”

Repairing Tips

Once you have bad credit, there are many things that you can do to start improving it as quickly as possible. These include:

– Keeping your balance on your lines of credit as low as possible

– Paying your debt off. Don’t move it to somewhere else.

– Getting rid of your credit car debt.

– Keeping your unused credit cards open, but keeping the balance as low as possible.

– Not applying for new credit cards in the hope of improving your credit

– Not opening multiple accounts very quickly, as this makes you look like a risk

New Credit

Another issue that people face is that while they don’t have bad credit, they simply have no credit. The result is that lenders don’t want to work with them, because there is no history for them to check. Not having a credit history can be very damaging.

“If you fall in the no-credit category, you haven’t necessarily made any financial mistakes. In this case, a good way to start building that history is to acquire a credit card for people with no credit.”