Things are happening in this economy that are going to impact many people’s credit scores whether they like it or not. Specifically, the banks are reducing credit card limits, raising interest rates, and changing payment terms so that monthly payments are larger than ever before. On top of this, people are losing jobs, or suffering under health care difficulties, so credit scores for many are also taking a hit. Credit report repair does take some time, as there are really no quick fixes (despite what scammers might tell you). However, if you follow some simple steps for at least a few months, you can start to see improved credit score within as little as two or three months.
Late payments are likely the main reason your credit is poor. So first, you have to make a committment to pay all of your debts on time. If you’re not able to make the minimum payments on everything by their due date, you should try to earn some extra income to get additiona funds to bring your debts current. Otherwise, you will need to use debt negotiation efforts with your creditors to arrange payments that will work for you. Until your debt is current, your credit score will not improve.
Something else which is also often overlooked are errors on your credit report. You should get rid of any errors that lower your score, for example incorrect collections records, someone else’s credit (sometimes relatives can show up on your report) and other mistakes. Once these get fixed, it can have an almost immediate impact on your credit.
Once you get your payments all up to date, and you’re sure your credit report has no errors, you can start to reduce your debt balances. One item that contributes to bad credit is having too many cards open, with high balances on all of them. Start by paying more than the minimum monthly payment on the card with the lowest balance. This will save you interest payments, and also get it paid off faster. Then take that total monthly payment you were paying on that card, and apply it to the card with the next lowest balance. This is called a “debt snowball” and will help you reduce your debt faster than if you paid the minimums, improve your credit and save a bundle in interest payments over time.
These are the two basic simple steps toward credit report repair that you can start today. By sticking to making payments on time on a regular basis, your credit score will begin to improve without a doubt.
Where do you turn when you’re desperately in need of credit repair help? Well right here at Credit Help Online of course! Seriously, the credit repair tips you need to get started are not that complicated. The worst part of having credit trouble is feeling as though there is no light at the end of the tunnel. Well, we’re here to tell you that there is, we have been through it all, and it might take time and patience, but any credit problem can be solved.
There are plenty of credit repair agencies who will offer to help you, but the fact is, you can do most if not all of it yourself. Except for a severe case, where you seriously should consider filing for bankruptcy, the steps are the same whether you do it or you hire someone to do it. If it’s going to cost you fees or time sitting in a classroom, you might want to give it a try on your own first.
We have several posts on this website that describe how to get started with repairing your credit, so we’re not going to list all of those ideas again here. But the most important thing you’ll need, not on those lists, is a change in attitude. You are having credit problems for a reason – like most Americans, you probably have used credit as another source of income, except it’s not income, it’s debt. You owe someone else, and they can take it back from you, whether through legal action, repossession or otherwise. The first step is to realize that you must live within your means. There is no other way to have a secure financial present or future.
To live within your means, you need to know how much you have coming in, and how much you have going out for expenses. To the extent you have too much going out, that it, spending too much, you need to put the brakes on, and either save that money, or redirect it to paying off debt you have already. We all spend money we don’t even think about – and that’s the second step, to stop spending without thinking about it. You should prepare a budget, which is not rocket science after all, and then stick to it. It might take you three or four months, but by making a commitment to never be in debt again, and stop struggling financially, you can do it.
So credit repair help is best when it comes from you – because you are the only one who really has a stake in fixing your own credit. And you can see all the credit repair agencies you want, if you don’t learn how to stop overspending, you’ll just find yourself in the same boat, all over again. (Believe me, we’ve been there too – making the same insane mistakes twice!) The best help is to decide once and for all you are not going to spend more than you make, and then take that next step to determine that you will know, absolutely, where you spend all of your money.
Now, the only way to know where you spend your money is to do that budget. We have a free budget form right here. It is actually very simple. You have a list of the things you need to pay for this month, starting with the items you must have, like food, shelter, heat and water, and transportation to work. (Notice I didn’t say, “luxury transportation to work”.) After that, you can list the items that are “discretionary”, meaning you can choose not to buy them in any given month. Once you know what you must spend money on, as opposed to what you want to spend on, you are on your way.
This will also tell you if you have obligations, beyond the necessities, such as credit card or loan payments, which take you above and beyond your monthly income. If you have credit payments that you can’t afford, then you REALLY need a budget! And you also need to check out the section of this blog that talks more about how to negotiate debt with your creditors.
These credit repair help ideas will get you started on your way. Have patience, promise yourself that you will make this financial change in your life, and it will impact your wealth for a lifetime.
More Americans are in need of bad credit help than ever before. With high balances on credit cards, many card holders are watching helplessly as the credit card companies hike interest rates and cut available credit. Making the minimum payment is harder than ever for some families, Plus, the impact of lower limits on credit scores means fewer Americans qualify for credit.
Even if you’re not delinquent with your bills, or facing bankruptcy or foreclosure, you still may want to get some credit help to figure out how to reduce the burden of high balances and high payments. Credit help can come from many sources, including do it yourself.
Since so many people are having trouble, the ads on television have blossomed with offers to help you with your debt burden. Many of these credit companies simply negotiate with your credit card issuer to reduce your balance or lower your monthly payments. Some horror stories are out there too, as some of these companies can be scammers. For example, one debtor had a company tell her she just had to sit and wait for seven months, not making payments, and ten the credit card companies would work with her to reduce balances. This bad advice was after she’d paid them a hefty fee! To follow this type of advice would destroy your credit score even more than it already might be.
There are some legitimate credit repair companies though. Many of these are not for profit companies, and don’t charge you high fees. They work with credit card companies to reduce your monthly payments to make them easier to afford, but generally your balances will remain the same. It’s important to note that some of these nonprofits are funded by the credit card companies! And the fact that you are working with them will appear on your credit report – a fact that some lenders will consider as bad as filing for personal bankruptcy. So, be sure to ask if that’s the case with any company you work with.
Another point is that these companies will focus on your credit card debt, which is unsecured, and would be discharged in a Chapter 7 bankruptcy. They are not as focused on working with your secured lenders, your landlord or mortgage company, and so on. They want to see if you have the money to keep paying your credit card bills.
It’s not altogether necessary for you to work with a credit agency though. Many lenders know that many Americans are having financial trouble, and they take the approach that the sooner they get an agreement in place with you, the better, before you decide to stop paying them altogether. Not all companies will work with you though to extend credit help. For some reason, there are banks out there who insist still on playing hard ball and threatening you to keep paying as agreed.
How would you go about doing a credit repair program on your own then? You can do just what the credit counseling agencies will do. First, you should have a budget. You should know how much money is coming in each month or week, and what your necessary living expenses are. Make sure that you are meeting the costs of living first – your food, rent, and utilities – before you start negotiating with your credit card companies. You probably want to work with your secured lenders too, to see if they will renegotiate your loan terms, or give you a couple months off so you can get back on your financial feet. Remember thought that secured lenders can simply repossess your car, or house, or whatever goods are securing your loan.
After you have a good picture of what money you have each month to pay unsecured bills, talk to your lenders. Let them know you can’t make payments based on their new terms, and that you want to work out a plan. If any of them refuse to work with you, then work with the ones who will. Make the others sit and wait for a payment.
Ideally you’ll want to keep your payments current, otherwise your credit score will suffer. So some of the tips here are for those of you who can’t make the minimum payments each month. If you are able to pay your minimum monthly payments, that’s great, but then you want to take steps to start chipping away at your overall debt to be able to have an emergency fund, or retirement fund, or save your money to build wealth, not just keep paying creditors.
Whether you are able to make your minimum payments or not, you should take action to earn some extra income to pay your debts off faster. Once you have all your debts current, you can start finding ways to put more than the minimum payment toward your bills. And if you’re having trouble making monthly payments, then you definitely need to find a way to make some extra cash to pay your bills.
Try selling household items you don’t need any more, using eBay or Craigslist. You might also consider selling items that are really too expensive for your lifestyle – the expensive tee vee, the expensive car, the expensive jewelry. These are items that you have traded your financial security for – and they are not worth losing everything. Selling things to raise cash is quite popular these days, and be sure to put all the extra cash you earn toward your monthly payments.
Another route is to get a second job. This economy is tough, as many people are losing their full time jobs, and part time jobs are competitive. But it’s not going to get better in the short run, so even if you have to deliver pizzas or bag groceries, you should try to earn some extra money each month.
Finding ways to make money on the internet is also an alternative. This method can be inexpensive, but does take time to build an online business. There are many websites that should you how to do this, but don’t spend a lot of money on anything until you have a chance to check it out thoroughly. There are scammers, there are “courses” which charge thousands of dollars – and none of these will help you as much as the more modest sites that really want to teach you how to build an online business. (We recommend The Keyword Academy, which has information about how to make money online with a one month trial for just $1. Worth checking out at that price!)
The bottom line is that if you are going to seek credit help, be sure to educate yourself about all the options available to you. don’t sign up with the first credit counseling agency you come across, or don’t believe what you see on television. You can find great resources on the Web for low or no cost, and can get started on your own, for free.
