subject: Repairing Your Car Loan Credit by Yourself [print this page] Repairing Your Car Loan Credit by Yourself
Repairing your car loan credit is not hard if you know how. I had to do this in order to pay off my existing loan for my car and I learned so much in the process. In fact, the steps that I took could be applied to my finances in general, making it easier for me to avoid bad credit in the future and rebuild my low credit score.
I had to face the fact that my credit issues with my personal finances could not be ignored. As I needed to keep my vehicle for work, I had to use important methods to avoid losing my car and facing those horrible collection calls that I knew would come if I continued to let things get behind. However, I had to accept as well that this could not be achieved overnight and that I had to drum up the courage needed to face my financial issues head on.
So, how did I repair my car loan credit? First, I spoke to a financial advisor who gave me five productive ways to fix the mess I was in. This what he suggested:
get my credit report from the three major credit bureaus
learn to read my credit report to see what was hampering my ability to get a loan
document disputes and discrepancies immediately and approach the relevant lenders to have these resolved and shown as such on my credit report
rebuild my credit in a methodical and sensible fashion
contact my car loan lender and come to arrangements for lowering or stopping interest on my principal balances and lowering my existing monthly payments
paying my agreed to new monthly payments on time
getting my car loan lender to update my credit report appropriately to show that I was making efforts to improve my credit
waiting until I had paid down my outstanding debts for at least a few years before even considering any other types of loans (only those that I could afford)
getting rid of any other outstanding debts and my credit cards
The reality is that repairing your car loan credit yourself is far better than waiting until your lender hands over your loan to a collector. Once collectors get involved, your credit report takes a nose dive and you could lose your car through a repossession order. This was not something I could afford to do and you should avoid this at all costs because such an order will damage your credit for up to fifteen years and no one will lend you any money and you might not even be able to rent a home if you needed to.
