Step One to Financial Power: Repair Your Credit Rating
If you are the victim of a terrible credit rating, you really do have to despair. Aside from the really bad reputation it seems to bring, it can also seriously curtail the financial institutions available to you. For example, applying for a credit card will definitely become a hassle – with you on the receiving end of not a few rejections. Loans will be terrifically hard to come by. And if you do come by them, they will most certainly be severely limited.
So what can you do aside from moping around in despair? Well, for one, you can blow your nose and start looking up because your situation is not hopeless. Even if you may be the owner of a world-class, depressing credit rating, there are steps you can take to help lift your credit rating to better heights. Here are a few of them.
1. Know Thyself - First of all, credit repair takes a lot of work, time, and patience. That is the sole reason there are credit repair agencies in the first place. If you intend to help fix your credit, a lot of work must be done. The first thing you will need is a copy of your credit report. Having this will help you know where you stand in regards to you credit. Knowing where you stand is critical to knowing where you will start in your credit repair efforts. Luckily, a credit report is mandated by law to be furnished to you annually for free. So make the most out of this opportunity.
There are many credit reporting agencies that can also help you with this. Go through the internet or your local phone directory for agencies offering the service. Write or email them requesting your credit report. Upon contacting them, make sure you include your a) request for a free credit report b) identification such as driver’s license, utility bills (to prove that you really live at the address you state), c) a copy of your social security card, d) a summary of the addresses you have lived in the past five years. Make sure you end your request with your own signature.
Look at discrepancies in the text, there are sure to be entries there that are disputable. Make sure you give them a good look. Jot down entries that are dubious and file a dispute with the creditor or with the credit bureau (if the error is typographical or is a sure glitch). Most institutions have means for these disputes; you may avail of them to clear out some of the ugly patches from your credit history.
2. Create a Plan to Eliminate Debt – Debt, debt go away, come again another day! The best way to get rid of debt is, of course, to pay it away. However, this may not seem easy or possible to some people – especially if the debt is long due or has earned enough interest to boil you in fat. The best that you can do is to talk to these creditors so that you can work out a plan to eliminate the debt that is amenable to them and something you can do.
This may involve some preening and pleading, most creditors are open to scratching some fees or waiving some of your debt if it means that you get to pay – it’s a lot better than you not paying at all. You will, however, have to get ready for some pretty heavy words, but hey, that comes with the business.
3. Keep Your Hands Clean – While you are repairing your credit keep your hands off new debt. Aside from sullying your credit history, it will definitely hurt your ability to pay outstanding debt. Better to wait for better times to roll, in this case, at least.