With the current state of the country’s economic status, it is no big surprise that there are so many people that are facing negative credit scores. These tips can help you gain insight on how you can get a better credit score.
An imperfect credit rating can make financing a home even more difficult than normal. Federally guaranteed loans (FHA loans) may be an option. You may even be able to secure your down payment and closing costs through an FHA loan. It depends on if you qualify.
Secured Credit Card
A secured credit card might be a good option for the person with a poor credit score. Secured credit card applications have a high rate of approval because you must fund a security deposit against your credit limit. Using this card responsibly will improve your credit rating over time, and eventually you’ll be able to get a normal credit card again.
Any of your credit cards with balances that are above 50% of your overall limit need to be paid off as soon as possible, until the balance is less than 50%. If you have a balance that is more than 50 percent, your credit score will drop. If you can, pay the balances on your cards; if not, do your best to pay as much as possible each month.
You can easily get a mortgage if you have a high credit score. If you wish to have an even higher credit score, make sure that you pay your house mortgage off on time. Owning your own home also improves your credit score in the form of having large assets to borrow against. If you have to take out a loan, this will help you.
To start fixing your credit, you will have to pay your bills. Not only must bills be paid, but they must also be paid in full and in a timely manner. Getting rid of past-due bills will have a fast and dramatic effect on your credit score.
Don’t attempt to fix your credit in a way that will result in you breaking any laws. As we speak, people are trying to take advantage of illegal practices to have people create credit files that can get them into trouble. Creating a new credit file is very illegal and you can be easily caught. The end result of getting caught during the crime could be expensive legal fees and a possibility of time behind bars.
When attempting to improve your credit, you should go over any negative marks with a fine tooth comb. You could find mistakes in dates and other factors which can cause the whole item to be removed from the report.
If you are living beyond your financial ability, stop now. You need to change your thinking to consider your future goals, not just buy all of the things you want right now. Unfortunately, credit has been easier to get than ever. Many people are buying things that are unaffordable and end up paying more than they should for any item. Keep track of your spending habits and income, then realistically create a budget that will get you out of your debt dilemma.
To keep your credit in good standing and get a better score, maintain a low balance on revolving accounts. Just lowering your balances can raise your credit score. The FICO system notes when balances are at 100, 80, 60, 40 and 20 percent of your total credit available.
Now that you know various ways to repair your credit, why should you wait to use them? You should take action before your credit gets worst, at least to slow down the process.