Repairing bad credit need not be an intimidating task. If you want to do it on your own, you must first be aware of your financial situation. Knowing that you have bad credit loans alone is not enough. You need to know the specific details about your debt in order to come up with an effective plan. On this post, let’s talk about the steps you can do to improve bad credit.
Examine your credit report. How much debt do you owe each of your creditors? What kinds of accounts do you currently have? How many times have you been late with your payments? You can check all these information from your credit report. Before attempting to repair bad credit, order a copy of your report from each of the three major credit bureaus (Experian, Equifax, TransUnion).
If you have not yet receive your free report for this year, you can request your annual credit report at www.annualcreditreport.com – the only online resource authorized by the government to distribute free consumer credit reports. Take note that the three bureaus gather reports independently so it’s best to order all three copies of your reports to make sure that your records are accurate.
Clean up your report. Checking your credit report gives you the opportunity to dispute errors or inaccuracies. To file a dispute, you can send a credit dispute letter to the bureau that issued your report via registered post mail. Upon receiving your letter, the bureau will conduct a 30 day investigation to verify your complaint. If valid, the bureau will make the necessary correction and notify the other two credit bureaus about the changes made. You should also receive an updated copy of your credit report for free.
Disputing errors and incorrect details in your report is a very important step since such inaccuracies can cause damage to your personal credit rating. If your report contains unauthorized charges or past due debts that are supposedly paid, correcting these errors can instantly boost your credit score. On the other hand, if all information in your credit report is correct, then you should move on to the next step to improve your credit.
Stay current with your payments. If you have past due charges, the best way to raise your credit scores is to pay off your debts. Nevertheless, some people may find it difficult to pay all their creditors at once especially when debt has accumulated. In this case, you should first sit down and evaluate your options.
One way to deal with the problem is to check which of your accounts have the highest rate of interest. Prioritize your account with the highest rate to prevent your debt from quickly accumulating. Another option is to completely pay off your lowest debt so you can eliminate one creditor off your list.
Another great strategy is to speak with each of your creditors and request for modification of your repayment terms. You can also ask if some of the fees be waived or if the interest rate can be reduced so repayment would be much easier. Most creditors will gladly adjust their repayment terms to assist a customer struggling with repayment rather than pass the account to a debt collection agency.
About the Author:
Suzy Vanstrusen is a credit analyst and a writer on the website EZCreditRepairSolutions.com. She has been providing consumers with tips and wise information about credit repair as well as helping you out more with your bad credit loans. Copyright © 2011
- Do It Yourself Credit Repair
- Best Borrower Tips to Avoid Bad Credit
- Helpful Tips for Erasing Your Bad Credit
- What Is Bad Credit Debt Consolidation?