Bad Credit Repair

By: William Lingle

The first step in getting your credit restored is to find out just how bad it is. You will need to pull your credit from all the major credit bureaus. Nothing is ever easy, is it? Lucky for us, you can get a combined report that has all of your information from just one place. And while you are at it, it would be advisable to get your Fico score from all three credit bureaus too. It is this score that makes the big difference. In fact, the whole reason for fixing your credit report is to improve your score.

Ok, we know what the damage is. So what now? Well the answer to that is going to be different for everyone. First, scan your credit report for misinformation. The credit bureaus are not infallible and can make mistakes. Look over each section of your credit report and make sure there is no information that doesn't belong. Misinformation is the easiest to dispute, so make it your first step. Sometimes other people's information will reside in your report. Look for wrong social security numbers, current and past addresses, for example. Make sure that all the credit lines are yours. That includes credit cards, auto loans, home loans, student loans, and even movie rentals and gym memberships. The last part of your report will have the most important items like foreclosures, bankruptcies and defaulted loans. If it doesn't belong to you, it needs to be disputed with each reporting agency that is listing it and removed.

Keep an eye out as you read through your credit report for items that you think are helping you and those that are not helping. There are techniques for removing items from your credit report that would need a whole article in itself. Just know that it is not necessary to wait seven to ten years to have negative items removed. These techniques are not limited to credit repair services and lawyers. Anybody can do them.

So now we can begin looking at building new credit. There are many ways to build credit. One of the easiest is to keep a small balance on your credit. This shows creditors that you have the ability to borrow money and pay on time. The balance you keep on your cards should be about 35% of your credit limit. This is your debt to credit ratio. I'm not saying you have to keep this ratio forever, just long enough to build some credit. If you don't have any credit cards and can't qualify then perhaps a secure credit card is what you need. This is a credit card you put money into, borrow from and make payments on. Make sure the secure card you get reports to all the major credit bureaus.

Lastly, you should monitor your credit reports and scores for 6 months to a year. Many of the services that provide reports and scores allow you to sign up for a service that allows multiple views of your report and score. This will allow you to monitor the positive changes you make to see if they have an impact or not. Also by watching for major changes in your scores can alert of you of possible identity theft.

I hope these five steps will start you on your way to better credit. With some diligence on your part we can make that one less American suffering from bad credit.

Credit Matters
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