You may have read tons of articles about “tips on how to fix my credit”, but they often involve paying down your debts. What if you are financially hard up today, but you want your credit score fixed so you can get a better loan, job or perhaps a nicer apartment than what you could get with your current credit score?
Here are some tips that help you eliminate negative listings and boost your credit score at the same time without parting with your cash today.
Get your credit report.
If you want to know the amount you owed, the new credits you had, your payment history and your credit mix, then look at your credit report. Your credit history will give you an understanding of your borrowing habits and whether you are responsibly repaying your debts or not.
It is not enough that you rely on the monthly bills on your doorstep. Sometimes, even it may overwhelm you for a minute or so, a credit report is all it takes to make you start all over again. Government agencies, credit card companies, banks and other parties where you have been financially involved as a borrower or as someone obliged to pay off a financial obligation; will provide information to the credit bureaus about your credit history. The credit rating agency will compute your credit score based on the information collected. Lenders will determine your credit worthiness based on the records which reflect your track record of repaying your debts and your financial ability.
How many times have you missed payment? Timely payments will show lenders your willingness to repay a debt. If you have not made regular and on time payments, they may also look into how many times you made an overpayment to offset missed payments.
The most common consequence of a negative credit score is a reduced ability to get favourable loan terms. Credit history has a strong impact on the interest on loans; the higher the score, the lower the interest and vice versa. Lenders usually charge higher interest to borrowers with low scores to offset the higher risk of loan default. Some employers also perform credit checks on job seekers.
Review your credit report.
Once you have obtained your credit reports, read them thoroughly. You may have several pages of credit report, based on your credit history. But, be patient. It may be difficult to digest and the debts may hold your breath up in a hitch. Take time to read each entry even if it would take you several weeks to finish. The important thing is that you have a complete knowledge of your borrowing history.
Get reports from different credit bureaus. Start with personal identifying information, and make sure that it does not belong to someone else. It is not unusual to get listings for accounts which should not have been attached to you in the first place. There are many data entry errors that affect the credit scores of many borrowers.
Look for entries in the public record, like tax liens and bankruptcy.
Identify information that needs repairing. Classify them into following categories:
- Incorrect information: Include payments which have already been paid, or those which have been incorrectly entered as late when you have actually paid for them on time. You may want to keep the receipt handy to dispute this type of listing. Include default accounts that do not belong to you and debts which are not yours.
- Past due accounts: Include all accounts you sent to collections, and those which are charged off and late. It is important to keep tabs on the accounts which have been repetitively entered despite payment.
- Maxed out accounts: Do you have credit cards which exceeded the credit limit? It will help you identify the credit accounts that have been seriously damaging your credit score. Remember that utilisation ratio really matters.
Make a credit repair plan.
The first thing you may want to do is to fix incorrect information. You can call the creditor, write them a letter requesting for the correction of entry or you can simply dispute the items in the credit report by calling the credit bureaus. You need proof of payment, so keep your receipt handy. In case of identity theft, it will be helpful to inform the authorities to prevent this from happening again.
Here are tips when sending your dispute to the credit bureaus:
- Write a dispute letter
- Include a copy of your credit report.
- Highlight the items you’re trying to dispute and a copy of proof that supports it. If you are complaining about an incorrectly labelled “late payment” make sure you send a copy of the receipt stating that you have paid the bill on time. Don’t send unsupported dispute as the credit bureau may decline to investigate it. Remember that a legitimate dispute will compel the credit bureau to conduct an investigation, oblige the creditor to verify if the information is accurate and come back to you with a positive or negative response.
- Get the help of us at Clean Credit. Disputing negative entries is a tough process. Skilled and experience credit repair professionals at Clean Credit can do the job, hassle-free and at a reasonable cost.
Do you want to learn more tips on how to fix your credit? Contact Clean Credit today!