| Rebuild Credit
Taking the Right Steps to Get You There Faster
After a financial setback, your first step in recovery should be to rebuild credit.
Whether you have suffered a bankruptcy or just experienced a difficult period which reflects badly on your credit report,
you can still start a new, improved credit history.
This will be an important tool in securing the things in life that you want and need.
However, this is a meticulous process.
Pay close attention to this step-by-step plan for renewing your credit profile and get started as soon as possible.
When you take positive steps to rebuild credit, you improve many aspects of your life.
Good credit impacts insurance premiums and also has an effect on your chances of getting certain jobs.
Fix errors in your credit report. Most credit reports, even those for people with above-average credit, contain errors.
They list debts that have been resolved or mistakes that you never made. You can fix these errors, though, and remove them from your credit
report permanently. Get a free report once per year from Annual Credit Report.
• Make missed payments As long as you are behind on any of these, your credit report will suffer.
If you are having a hard time catching up, make arrangements with your creditors to accept an altered payment plan.
Make sure that your adherence to this new plan is reflected in your credit report.
• Stay current on all present debts and bills, including utilities and others.
These make immediate impacts on your payment history. One way to avoid missing payments is to arrange for automatic deductions from
your bank account. This tool is used not just for convenience but also to keep your credit history perfect.
• Open a line of secured credit.
It is impossible to rebuild credit without having a history of making credit payments. However, once you have bad credit many companies will
refrain from offering credit. You can get out of this quandary by making a deposit to support a secured credit line.
You can essentially use as much money as you deposited because the bank behind the card is under no risk that way.
• Upgrade to a more traditional, unsecured credit card.
Make a few months of timely payments on your secured line and apply for an actual credit card.
Not everyone will be willing to offer your credit but some will.
Good candidates for this process are department store cards. With these, make your payments in full each month for at least six months
before applying to a more general credit card supplied by a bank.
• If you have credit cards with no balance on them, do not close them down.
Your credit score improves
if you use a low percentage of what is available to you.
• Make as few inquiries for new credit as possible. These are reported and can look bad on your credit history if they are too numerous.
• Use online agencies to track your credit score regularly as you begin your new life with good credit.
Even if you do everything right, errors can hurt your credit card score
in the future.