Credit Repair Tips for Consumers with Bad Credit

Did you know that an estimated 1 in 3 Americans has credit problems? If you have bad credit, you can repair it. It’s a long and difficult process, but one that is absolutely possible with a little work and a lot of patience. Credit repair is about more than just one’s personal finances, it can also affect one’s overall health and stress levels.

Many consumers today are struggling with credit problems.  But you don’t have to look at bad credit as a long term problem.  Its a temporary state.  One that you can overcome and come out of.

Credit Repair Tips Bullet Points

  • Know what the real problem is.  To much credit, over extended? Can’t repay what you already owe
  • Know your rights
  • Invest in a credit monitoring service
  • Understand how your credit score is calculated – click here to read our article on how your credit score is calculated
  • Learn how to dispute errors on your credit report
  • Create strategies for dealing with debt
  • Will you do it yourself or hire credit repair company

What is the real reason you have bad credit?

credit repair facts

Bad credit can be brought about by many things.  It can be brought about by a sudden change in your financial status such as loss of job, unemployment, reduced salary, unsuccessful business, etc.

Sometimes, bad credit can be caused by poor habits such as overspending and ineffective budgeting.  It’s important to be aware about the real cause of the problem so that it can be addressed correctly.  This way, it can be prevented from worsening as you do the necessary steps to improve your credit.

Check your personal credit report.

Start by ordering a copy of your credit report from each of the three major credit bureaus (Equifax, Experian, TransUnion).  Study your report to make sure that it does not contain errors, outdated information or incorrect details.  If you discover errors, send a letter to the bureau that issued your report immediately to have them corrected.  Take note that erroneous information can pull down your credit score.

Under the Fair Credit Reporting Act (FCRA), consumers are entitled to receive free credit report once each year. You can order your free report from each of the three credit bureaus by visiting Annualcreditreport.com.  You are also entitled to a free credit report if you are presently unemployed and plans to seek employment within the next 60 days, or if you suspect to have been a victim of fraud.

BUt understand that the free credit report you get from annualcreditreport.com WILL NOT contain your credit score.

Know your credit rights

You can see a summary of your rights under the Fair Credit Reporting Act by clicking here

Know how to dispute errors

Disputing errors on your credit report is an important part of the credit repair process.  A dispute can be filed on a credit report in three instances: if the information is inaccurate, incomplete, or unverifiable.

If an individual finds that their credit report contains errors, they can either live with it and hope that the errors will eventually get fixed by themselves, or they can initiate a dispute and wait for a response from the credit reporting agencies (Experian, TransUnion & Equifax).

You must keep good records of the disputes you file.  If you do this part incorrectly.  Your disputes can be marked friviolous and your credit repair efforts will not be very effective if the credit reporting agencies are ignoring your letters.

Negotiate your debts. 

One essential step to recover from bad credit is to negotiate with your creditors.  You can significantly reduce the amount of your debts through proper negotiation.  The important thing is to request for a reasonable adjustment with your repayment term, ensuring that you will be able to follow the new repayment terms in case your creditor agrees to your request.

For instance, you may ask some of the fees to be waived such as late penalty fees and over-the-limit fees.  You may also ask for a longer repayment period or a reduced rate of interest.

[MORE INFO: Negotiate Your Way To A Better Credit Score ]

Acquire new credit to repair bad credit.

As soon as you have managed to reduce, eliminate, or at least control your debts, you should think about acquiring new credit to improve your bad credit.

For example, you can apply for a bad credit credit card or a secured credit card.  Using this type of credit card is a great way to build up your credit score.  You may also considering obtaining a credit builder loan.

Seek professional help.

It is also a good idea to seek professional advice from a reputable credit counseling agency.  A trusted counselor will be able to help you plan an effective debt repayment strategy as well as a proper budgeting plan that you can follow.  Check out our credit repair program here

In conclusion, there are several ways to repair bad credit. For people that find credit repair stressful, tedious or just don’t know where to start, you should consider hiring a credit-repair company, but there are also other solutions such as negotiating with creditors, creating a budget you can live with and the last option should be taken only if all else fails and you just can’t pay all you owe.  File for bankruptcy.

 

 

 

Elizabeth Roberts

Elizabeth Roberts

Liz Roberts and her team are continuously providing information to people who are ready to repair their credit and improve their credit score. Also NewHorizon.org team strives to empower the homebased and small business owners by bringing information that can help them to manage and grow their businesses. Let our 23+ years of business finance experience help you to get the financing you need! CONTACT US if need financing for your business.

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      NewHorizon.org is an independent, advertising supported website. The owner of the site may be compensated in exchange for featured placement of certain sponsored products and services, or your clicking on links posted on this website. NewHorizon.org has not reviewed all available credit card offers in the marketplace.

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      NHBS Inc © 2022

      NewHorizon.org is an independent, advertising supported website. The owner of the site may be compensated in exchange for featured placement of certain sponsored products and services, or your clicking on links posted on this website. NewHorizon.org has not reviewed all available credit card offers in the marketplace.

      Privacy Policy Terms of Use

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