It is especially frustrating when a person has poor credit. It shuts out opportunities, including being qualified for loans, being qualified for an apartment, or getting a credit card. The good news is that you can do some parts of improving your credit on your own. However, it is possible to gradually restore the credit history, by investing time and effort in it.
Here are tips for how to repair your credit on your own:
Check Your Credit Reports
The first of these is to request your credit reports, and then check for errors as a way of beginning the credit repair process. This service is known as Annualcreditreport.com whereby one is allowed to get a free credit report from the three significant credit reporting agencies namely Equifax, Experian, and Transunion every year. Go through each carefully looking for any inaccuracies like:
- They are often attached to accounts that do not belong to the user.
- Wrong contact details (for instance wrong physical address or name spelled wrongly)
- Some accounts which are not supposed to be considered as being in the delinquent group.
- Some of the specific accounts that should be taken to the closure account or paid-up account but are not.
If you identify any errors provide a written dispute to the credit bureaus and attach copies of bank statements or any other supporting document. The credit bureaus are typically allowed 30 days to reply to such requests. Just keep up with the things, and keep on checking up until the errors are taken off.
Pay Down Balances
This factor is one of the most significant influentials when it comes to credit scoring, and it refers to the amount of credit you use concerning the total credit that is available to you, also known as the credit utilization ratio. This should be below 30%. Therefore even when you are in a situation where your credit rating is low, paying balances on the credit cards is useful because it enhances the utilization. Reduce the balance you can afford to pay back each month to owe less.
Become an Authorized User
Request a friend or a relative with a good credit rating to sponsor you by providing an account link to a card that has been in existence for a very long time. One positive aspect of being an authorized user is that your report gets updated with the history of the account itself and therefore it prolongs your credit history and consequently your credit score. Also, do not encourage the primary cardholder to give an actual card in your name for fear of incurring high bills.
Secure credit cards are easy to get if you apply online and they offer great opportunities to rebuild credit history.
Not paying your bills on time means that you might not be able to receive approval for using an unsecured credit card. Nevertheless, it is possible to receive approval for a secured credit card which may be an essential move. For secured cards, you submit an amount you want to be used as a security deposit which should not be less than $200. The credit limit is the amount of money you deposit into this account and which you borrow from the credit card company as needed. Secured credit cards are also like any other credit card since their data is conveyed to the credit bureaus. Some of the ways to transform it include; Ensuring that you clear the monthly balance on time to establish a good payment history which will help to increase your score.
Dispute Negative Items
Negative items such as late payments, collections accounts, bankruptcies, and the like all harm your score. If any items are included by mistake, submit appeals of why they are wrong. Document your disputes as a way of availing evidence against the opposers. The law is the Fair Credit Reporting Act and it states that disputes must be responded to within 30 days. Otherwise, they need to cross out or exclude the corresponding items from your reports.
Avoid New Credit Applications
Applying for credit ensures that whenever you require money with a bad credit score you can be tempted to open an account since you believe you cannot be rejected anyway. But every inquiry you make no matter if it was declined barely affects your score to some extent. Do not open any new accounts unless it is necessary while you are fixing credit. Applying and inquiring too much is bad for you, it portrays that you are desperate and that is what lenders will see you as.
Consider Credit Repair Companies
Although others may have advised you otherwise, you can indeed rebuild credit on your own if you dedicate the time and effort to do it. However, if all these steps appear quite tiresome and daunting, it is advisable to involve the services of a professional credit repair company. Some of them offer their services in dealing with the credit bureaus in correcting wrong entries and enhancing scores. Just beware of scams. While hiring these companies, ensure that you carry out your homework well and avoid falling prey to deceiving companies. It is important to be aware of some red flags such as upfront costs which are not allowed, promises of ‘repairing bad credit’, and the advice to obtain an EIN to camouflage your identity.
Stick with It
It is not a one-day affair to fix bad credit but requires a consistent effort over some time. Monitor reports frequently, update on bills, retain low-balance credit cards, challenge inaccuracies, and avoid applications. Of course, you are unlikely to change from bad credit score to great credit score in one go. But it is expected that you should see your scores rising progressively as you follow credit repair best practices month in and month out. Do not think that is moving slowly if it seems like that to you. And so, when you stay diligent your effort will never be in vain.
It is possible to rebuild credit on one’s own. To build good credit you need to periodically check your credit reports, fix errors, demonstrate responsible credit behavior consistently, avoid new credit applications that trigger hard inquiries, and wait for the improvements. It is possible to rehabilitate and increase their score if you are willing to do some work. Read through these tips carefully and apply them when you start repairing your credit.
Call now for expert credit repair services: (888) 803-7889
Read More:
Can I hire someone to fix my credit?
Can you fix a ruined credit score?
What is a loophole to remove collections from a credit report?
What can credit repair remove?
How much does it cost to fix my credit?
