subject: How To Repair Your Credit Score [print this page] Do you have bad credit? There are a few things you can do to improve your credit score. Read this article and start planning your credit repair strategy.
First of all, stop borrowing money and using your credit cards. Your goal is to pay back the money you owe and then work on building a good credit score. You need to put your finances in order and establish a budget. Determine what percentage of your income you can afford to spend on paying your debt back. Put enough money aside to pay your bills and buy necessities like food. Use the rest of your income to pay down your debts. You will have to make sacrifices until you can get back into a healthier credit situation.
Credit repair counseling solutions are available. If you feel like you need help to manage your finances and repair your credit, find an adviser you can trust. Read reviews on the Internet and do some background research on different services. It is possible to repair your credit without the help of a professional, but it will take a lot of research on your part. It may also take you a lot longer to fix your credit without professional advice.
Start by paying your largest debt first. If you can, group your debts into a single consolidated debt to save on interest and minimize the number of monthly payments you need to worry about. Get in touch with your creditors and let them know you intend to pay what you owe but that you need time. Negotiate with your creditors to agree on a payment plan and possible reduce your interest charges and late fees. Paying your outstanding debt first is the best way to avoid finding yourself overwhelmed with late fees.
Pay back one debt at a time and establish a strategy of tackling one debt after the other. You might need a few years to pay back everything you owe, but do not let this discourage you.
If you think there is no possible way for you to repay all of your debts, it's time to consider bankruptcy. Seek the advice of a lawyer that specializes in bankruptcy filings; this is not something you can tackle on your own. This solution will cancel all of your debts, but it will be difficult or impossible for you to repair your credit score after this.
Once you have paid back everything you owe, work on building your credit score back up. Start using one or two credit cards again or apply for a small loan you can afford to pay back quickly. Keep in mind that you have put yourself in a bad situation before and need to be careful with credit in the future. Always pay your credit cards on time and make more than the minimum payment every month; your credit score should start going up.
Use these tips to pay your debt back and to start building your credit score again. This process will take some time, but your efforts will be rewarded.
