Credit Repair and Your Future – How to Restore Credit in the Aftermath

Have you had serious credit problems but managed to get through them with credit repair

? Then you need to start building positive credit. You can do this in a couple of ways. If your credit repair efforts were successful, all three of your credit reports should look much better now. You should not have as much derogatory' credit on your reports. Accounts will have been updated or deleted if you repaired your credit properly.

But now you need to build credit. This will become very important if you ever want to purchase something on credit' again. Your situation will not resolve itself. If you don't build credit, you will not have a credit profile that an underwriter will consider. If you do nothing for several years, then down the road there will be nothing on your credit report and you will still be considered "high risk" because the underwriters will have no way to evaluate you. Sometimes underwriters will look at your bank accounts and utility bills and your vehicle insurance bills to see if you pay them on time. They can use that information to consider extending credit to you, but you will still be considered high risk and thus you won't be getting the better loans. High risk loans have high fees attached to them and high interest rates most of the time. You want to stay away from those kinds of loans because you will never pay down the debt in a timely manner. You might even end up up side down' on your car loan if your interest rate is 25% for 6 years. Do yourself a favor and never put yourself in this situation. You are better off picking up an old beater and paying cash for it than taking on a high risk car loan.

Building credit is usually done in two ways: 1) credit cards, and 2) small secured bank loans that report to the credit bureaus. Whatever you do, make sure the loan you get will report to the credit bureaus. You'll be wasting your time if your loan doesn't report to them. There are a lot of second chance' credit cards available. Yes, you are going to have to pay for them in some manner. The key is to keep the balance paid off and use them sparingly. Never think of a credit card as free money. They certainly are not free money.

You might be able to secure a small loan from your bank if you can offer them a car title or something of value. Make sure they report to the credit bureaus. This is really important. You can approach your bank with an offer like this: Tell them you will keep the money that they loan you in an account at their bank and you will make the payments on the loan using that money. Get a 12 month loan. If it is $500, even if they charge you 25% interest it will not cost you that much per month, and you are buying back your credit! You are going to have to suck it up' a bit. In the end though, when your credit is rebuilt, you will be glad you did!

Credit Repair and Your Future How to Restore Credit in the Aftermath

By: Matthew Wierzbinski

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