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If you are struggling to pay off your debt there are a few steps that can to taken to help repair your credit or rebuild your credit. In most cases repairing your credit can be done by hiring a company like Lexington Law Firm. The industry leader in credit repair.
It's hard to start repairing your credit when you don't even know what your credit score is, or what is on your credit report. Your credit report will be your main tool in repairing your credit. The government has made it so everyone in the United States can receive a free credit report once a year. We highly recommend that you take full advantage of this. The other method is to order your credit reports directly from the credit bureau agencies for a small fee.
It's important to request your credit report from TansUnion, Equifax and Experian because all of these credit reporting bureaus can have different information about you. Also, the credit company you are borrowing money from may not report to every agency. So ordering all three credit reports will give you a much more realistic credit history.
Review your reports
Once you receive your credit reports you should review them carefully. If they are viewed online then print them out and keep a copy of each one. Your focus should be on what each bureau reports and any history that may need to be repaired.
Look for any and all incorrect information such as work history, wrong birth date, payments made but that were never recorded, etc.
Look for accounts that have gone to collections, are past due or have been written off as a bad debt.
Also look for accounts whose balance is over your credit limit.
Disputes
If there is any information that is inaccurate you should dispute it immediately. Your credit report should come with instructions on how to do that but if you don't have any instructions write a letter to the bureau about the inaccuracy's and send a copy of your credit report along with the letter.
Past Due Balances
If you want to increase your credit score dramatically you should get all of your past due accounts back up to speed, current, and paid. Your goal is to get current on past due balances, pay-off your charge-offs and work with debt collects to take care of accounts in collection.
Are you maxed out?
Did you know that 30% of your credit score is made up of your total debt compared to your total credit? When your cards are maxed out your debt to credit ratio is extremely high and has a negative effect on your credit score. You goal is to bring maxed our cards below your credit limit again and work on paying down the balances. This will significantly increase your credit score.
Obtain new credit
This sounds bad right? Wrong, it's actually a good thing to get new credit. Once you've eliminated or minimized your negative credit it's time to start building up new (good) credit. If you have good accounts, make sure to keep them good. If you need to rebuild a little, try getting some new credit. Apply for a major credit card, a department store credit card or try to get a secured credit card.
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