Lots of people suffer from “bad credit” or in the last 5 years have suffered some kind of credit incident and this can affect your future for a long time. There are many companies that claim they can repair your credit however; with a little bit of knowledge you can do the same things for yourself. Here are some tips on how to accomplish this.
1. Get a full credit report:
a. This can be easily obtained ….go to http://www.annualcreditreport.com and obtain a free report from each of the 3 credit bureaus
b. Check all of the information on the credit report to verify that the information is accurate and all about you.
2. Pay off your negatives:
a. If the poorly rated items have occurred in the last 12 months, pay or settle them.
3. Start to rebuild!
a. Keep credit balances between 30-50%.
i. Never max out your credit card even if you make payments on time.
ii. You should never allow a card to become fully inactive.
b. Retain accounts you’ve had the longest:
i. This shows longevity in your credit report
ii. You want a minimum of 3 open trade lines at all times
4. Use a secure credit card:
a. A secured credit card is one of the easiest ways to build credit.
b. Apply for a small installment loan. Some banks offer credit builder loans and at the end of the term you have a small CD.
c. Put a sizable down payment down for a car and borrow a small amount instead of paying cash for a car.
5. NEVER pay 30 days late on any credit account.
a. This will automatically drop your credit score
If you are looking to make a major purchase such as buying a home keep credit inquiries at a minimum. For any questions of comments feel free to contact me at Ingrid.firstname.lastname@example.org