subject: Five great tips to improve your bad credit situation [print this page] Five great tips to improve your bad credit situation
Frustrated with bad credit and low credit score? Have you ever wondered why are you refused credit while you're friends never have that problem, even though it seems like their financial situation is less stable than yours? Improving the credit history is fairly straightforward, but requires some planing and, above all, the knowledge of how credit scoring works. Consider those ideas to improve your credit score and enjoy your credit capability again.
Have you got credit cards? They're a great way to get out of bad credit (or to sink deeper into it if you're not careful). Banks favour customers who use their credit often in moderate amounts and pay it off fast. You might think that bank likes you to pay interest on overdue credit card accounts, but the truth is that it undermines their trust in your financial responsibility.Use your credit cards in moderation, ideally not using more than half of the credit limit available, and pay them off quickly. Credit score boost guaranteed.
Make sure all your bills are paid on time. Yes, it's easier said than done. While we all experienced situations where the money is simply isn't there there's always a way to work around it. Call the company you owe the money to and ask to have the payment deferred. In 99% of cases you will have that granted so your credit score will not suffer.The reason? Companies appreciate people who take responsibility for their financial commitments and instead of ignoring the problem step out to arrange an alternative.
Do never, ever, ignore council tax. Late council tax payment may be one of the most damaging to your score. Never ignore a monthly installment. Council tax could even send a bailiff to get the money off you. There are people who advice against taking City Council seriously, claiming that all they do is send endless letters but, quite frankly, you should know better. If any of the payments is missed more than twice, the council will demand you pay the whole outstanding amount for the year and I'm sure you'd rather avoid that.If there's no money to pay with, call them and arrange an alternative payment deadline. You could even take a couple of months off from paying and spread the amount over remaining time until the end of council tax period.
Make a plan. This should really go first on your list. List all your expenses and decide which ones are essential. The point of that exercise is to cut non-essential spending and save up as much as you can over a couple of months. The extra cash could help to get on top your payments and improve the score.
Check the credit report. It is estimated that over 75% credit reports hold some errors which may potentially lower the score. Getting your credit checked is free and it doesn't take too long to run through it and spot any mistakes. Stop wondering what's your credit score and get it sorted, you'll soon enjoy great credit history and become a consumer again.
