Repairing your credit rating is a journey that can take some time; however, it’s entirely possible for anyone to turn their credit rating around; even if you have previously been bankrupt, or are soon to be discharged.
If you fear you might have bad credit it can understandably make you want to bury your head in the sand; but similar to getting a medical check-up, whilst nerve-racking, it tends to be much better to know where you stand so that you are in the empowered position to nip any issues in the bud rather than let them spiral out of control.
With that in mind, there are two fundamental principles you must follow when looking to repair your credit status: first, find out where you are and then find a way to repair any damage that has been caused and start getting back on track.
How to Repair Your Credit Rating
WHERE ARE THINGS NOW
The first step is to check your credit report, and if your score is less than desirable then at least this way you are in a more empowered position to take immediate action to start repairing your credit score. The first thing is to check for errors; some credit reports contain many errors due to simple administrative errors or complex issues such as identity fraud; be sure to check there are no late payments incorrectly listed for any accounts and dispute any errors you do find with the credit bureau.
GET BACK ON TRACK
If you have missed payments, then stop worrying about this – the damage is done – all you have control over is the current moment which will directly affect what happens next, and the best thing you can do moving forward is to ensure your bills are paid on time. Sometimes, borrowing money can be a justifiable and viable way to consolidate your debts and get back on track. There are many debt consolidation companies around that will offer you a secured or unsecured loan to cover your existing debt, meaning you can then pay off all your bills so that your credit score is no longer being affected negatively… and just make one monthly payment to the one loan.
The trick to getting back on track is to get up to date with your bills, even if that involves negotiating payment terms so that no further damage is done to your credit file or getting a debt consolidation loan as mentioned above… then, once you have “put out the fires” the next trick is to stay on track – making monthly payments on time, in order to start to repair your credit score. If you have a few red crosses on your credit file (representing missed payments) then the remedy is to start getting some green ticks. No matter how tempting, it might feel, burying your head in the sand and letting things spiral out of control is no remedy.
EARN MORE INCOME
This bonus tip is somewhat of a no-brainer, but sometimes people are so focused on ‘debt’ and feel stuck that they forget the simplicity of the situation in that what they really need is to earn extra income as the more money you are able to make, the better position you are in to resolve your financial situation and repair your credit record.