5 Essential Tips for Effective Credit Repair
Know What’s In Your Credit Report
The first step in repairing credit is to get your credit reports from the three major credit reporting companies. Because credit reports contain errors, it is important to review them for accuracy. Look for any errors that can drag down your credit score and take the necessary steps to get them resolved.
Pay Your Bills on Time
Making payments on time is one of the best ways to improve your credit score. Ensure that you pay your bills on time and that your credit report reflects these payments. If you are uncertain of when bills are due, set up reminders or ask for assistance from a credit counseling agency.
Challenge Irregularities on Your Credit Report
Should you spot any irregularities on your credit report, such as payments inaccurately reported as late or an outdated debt, immediately file a dispute with the credit reporting companies. The reporting agency is obligated to review the dispute and correct the error.
Pay Down High Credit Card Balances
High credit card balances can damage your credit score significantly. Use extra cash to pay down credit card balances to a reasonable limit. Ensure that your credit reports accurately reflect this information.
Get a Secured Credit Card or Loan
Secured credit cards and loans are excellent ways to build your credit by showing that you are a responsible borrower. Secured credit cards require a deposit before you can use them, while secured loans may require you to use an asset such as a car as collateral. However, it is important to ensure that you make payments on time, as late payments can cause more harm than good.
