How To Repair A Bad Credit Rating |
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This is going to take some time. Every time you are late on a payment, it hits your credit report for two years. That means once you are free and clear, it will take two years for your credit rating to get fully healthy. That may sound like a long time. But there are ways to affect information on your credit report that don't have to do with your missed payments, actions that won't take two years to have an effect. 1. Co-sign on a loan with a family member or loved one with better credit.Remember to make your payments on time. If you don't, the co-signer's credit history will suffer. This brings me to a really important point. 2. Limit Your Credit Options.Limit them to one or two. There's really no reason for you to tempt yourself with that much of a credit ceiling. If you have trouble with discipline, this is an invitation to trouble. More important in the short term, a creditor looks at your entire credit limit, not just the credit limit you have in that one place. Limiting your number of credit cards means you'll have fewer potential bills and therefore look like less of a credit risk. 3. Towards that end, call your credit card company and ask for a lower credit ceiling on your card.Follow this up by personally informing the three credit agencies about this change. This isn't a bad policy with any of the good changes in your personal credit. The quicker that information gets to those who report to potential creditors, the quicker you repair your credit rating. 4. Get a copy of your credit report and look for mistakes.The employees of the credit reporting institutions makes mistakes, too. The last thing you need to do is get blamed for something you didn't do. 5. Do not file for bankruptcy.This clears all your outstanding debts, but the bankruptcy stays on your credit report for the next seven to ten years. Once you get your debts payed, this remains on your report for two years. So if you want your credit report to look good sooner rather than later, do not go the bankruptcy route. 6. Finally, pay Your Bills on Time.Yeah, this sounds pretty elementary. You have bad credit because this isn't the case. But once you get your credit payments to a manageable level, make it your point to pay your bills and pay them on time. If you are late a few days on your payment, this is added to your credit history and will affect your credit rating. Set aside a day every month when you pay your credit bills and stick to the schedule. |
Getting healthy credit requires a three step
process. One, stop acquiring any more debt.
Two, get rid of your outstanding debts. Assuming
you are taking steps to get your debt under
control, then you can move on to the third
step: repairing your credit rating.