If you have bad credit, it is important that you repair it as credit repair can improve your credit enough to lower interest rates which can save you a lot of money on the long run. There is no quick way of repairing bad credit, it takes time to do it. By following the tips below, you can begin to repair and rebuild your credit.
Tips for Repairing Bad Credit
1. Go through your credit card report. Your credit report may have errors in it, therefore, request for a free copy and go through it for errors. Check that the amount you owe for your accounts are correctly stated on the report. If there are errors on the report, you can file a complaint with the Consumer Financial Protection Bureau who will contact the credit reporting agency on your behalf for free. You need to first dispute the information with the credit company reporting it yourself before filing a complaint with the CFPB. If you are not making a headway, you might then think of consulting a consumer law attorney who has experience with repairing credit bad credit cases. If you have a good case, you might be entitled to damages.
2. Set reminders for making payment. You can set the reminders on your own but some banks also offer this service by sending you reminders through email or text message to remind you when you are due to make a payment.
3. Come up with a payment plan Using your credit report, draw up a list of your accounts and check the recent statements to find out how much you are owing on each account. Devise a suitable plan on how to gradually offset the debt. (More on this here)
4. Even if you have missed out on making some payments, try and build up on a good payment pattern so that there will be evidence that you are now managing your credit well.
5. Get in touch with a legitimate credit counselor. You should do this to so as to be able to manage your credit well and make payments on time.
6. Upgrade to an unsecured card. After making timely payments for a few months, you can try to upgrade to an unsecured card. Ensure you pay your all your balance on time every month, then you can apply for a regular bank credit between 6 to 12 months.
7. Don’t close your old credit cards. Closing credit cards you own before can have a negative impact on the length of your credit history. If your card has an annual fee, put in a request to change it to the type that has no fee attached to it.