Bad Credit: 8 Steps For Repairing Bad Credit (from HowToEstablishGoodCredit.COM) Article

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Bad Credit: 8 steps for Repairing Bad Credit (from HowToEstablishGoodCredit.COM)

Anyone with a poor credit rating knows that having bad credit can affect his financial future. It is great that you still have a chance to improve your credit rating and therefore brighten up your financial future by following 8 practical steps in this article from www.HowToEstablishGoodCredit.com

Author: Bob

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Source: http://www.howtoestablishgoodcredit.com/Credit_Articles/index.php

Anyone with a poor credit rating knows that having bad credit can affect his/her financial future and can be a real problem. However, it is great that you still have a chance to improve your credit rating and therefore brighten up your financial future by being patient, a conscious effort, and a personal debt repayment to improve your credit report.

The most practical and effective way to truly improve credit is through a number of practical steps designed to help you not only improve your credit rating but also to maintain a decent credit rating once it has improved. This includes taking out credit and ensuring that you repay it responsibly and on time, continuing to pay other forms of credit and bills on time and for the amounts requested, and keeping a close eye on your credit report to avoid any mistakes or discrepancies that could further damage your credit. No matter how bad your credit is, taking following steps will make it better.

STEP 1: Dispute Inaccurate Information or Frauds in Your Credit Report

Each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — is required to provide you with a free copy of your credit report once every 12 months. You can dispute mistakes or outdated items for free. Under the FCRA, both the consumer reporting company and the information provider (that is, the person, company, or organization that provides information about you to a consumer reporting company) are responsible for correcting inaccurate or incomplete information in your report. To take advantage of all your rights under this law, contact the consumer reporting company and the information provider.

Tell the consumer reporting company, in writing, what information you think is inaccurate. Include copies (NOT originals) of documents that support your position. Keep copies of your dispute letter and enclosures.

After the information provider receives notice of a dispute from the consumer reporting company, it must investigate, review the relevant information, and report the results back to the consumer reporting company. If the information provider finds the disputed information is inaccurate, it must notify all three nationwide consumer reporting companies so they can correct the information in your file.

Tell the creditor or other information provider, in writing, that you dispute an item. If the provider reports the item to a consumer reporting company, it must include a notice of your dispute. And if you are correct – that is, if the information is found to be inaccurate – the information provider may not report it again.

What If Credit Report Includes Accurate Negative Information?

When negative information in your report is accurate, only the passage of time can assure its removal. A consumer reporting company can report most accurate negative information for seven years and bankruptcy information for 10 years. But by following steps 2 to 8 you can fix your bad credit and polish your credit history and risen your credit score.

STEP 2: Pay all of your bills on time

Late payments (payments that are 30 days late or more) have a negative effect on your credit rating. In order to fix your credit it is important to pay all of your bills (from utility bills to credit card payments) on time moving forward. You don’t want any more negative information in your credit report.

STEP 3: Reduce the number of credit cards you carry

Write to your creditors to request that they close your accounts and report this status change to all three credit-reporting agencies. It’s better to just keep one or two major credit cards and close all of those you have from different merchants such as grocery stores, department stores, retail stores, etc.

STEP 4: Avoid bankruptcies, tax liens and collections

A bankruptcy stays on your credit report for up to 10 years. Collection accounts and paid tax liens stay on for seven years, and unpaid tax liens will haunt you forever.

STEP 5: Request for Lower Credit Limits

Request in writing that your creditors reduce the credit limits on your accounts to lower your amount of available credit. The total amount of available credit is considered by lenders even if you owe nothing. Therefore reducing your available credit limit would lower your responsibility and that helps with lenders trust in you.

STEP 6: Get a Small Loan or Credit Card with Co-Signer

Ask a family member or friend to co-sign on a small loan or credit card to help you re-establish credit. Make your payments on time. When you have a friend or relative co-sign on a loan or credit card, remember that that person's credit will be affected by the payment history as well.

STEP 7: Get a Secured Credit Card

Get a secured credit card to help reestablish your credit. You will have to keep a designated amount of money in an account that will be sufficient to cover your charges. Make payments on time.

STEP 8: Periodically Get a Copy of Your Credit Report

Continue to get a yearly copy of your credit report to catch any errors and act immediately for any frauds in your credit history.

for more articles about Bad Credits and Credit Repair go to:
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Bad Credit: 8 steps for Repairing Bad Credit (from HowToEstablishGoodCredit.COM)