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Personal finance editors at CreditSources.org, (http://www.CreditSources.org), have evaluated numerous different credit building, repair, and preservation strategies to rank their top tips for fixing a bad or poor credit score.
(PRWEB) February 28, 2013
Today, CreditSources.org an industry leading authority site on credit related consumer issues and services, personal loan options for people with less than perfect credit, and credit cards, released its top tips for managing and addressing a bad credit report. Because below average credit scores can negatively impact people who are looking to apply for a job, rent a home, buy a car, or receive insurance premiums, the experts at CreditSources have ranked their most valuable tips for dealing with a bad credit score and personal debt.
Get the Facts - Pull Your Free Credit Report
Many people view their credit report as a mythical report only accessible to “credit people.” Not so. Federal law says that consumers are entitled to one free credit report from each of the big three credit reporting companies, Experian, TransUnion and Equifax. Each are separate companies and will likely have slightly different results, so get a report from each. Request a report, review it in detail, and understand the issues. Most people have some type of error on their report so review it assuming there will be at least one.
Avoid Denial - Deal With Reality and Move Forward
People can choose to be angry, blame others, fool themselves with denial and emotion, or, they can deal with their personal reality and develop a clear plan to fix their problems. One thing is for sure - problems won’t go away by doing nothing. Following a disciplined plan will move a person closer to fixing credit problems and obtaining a coveted “good or excellent credit score.”
Document, Dispute and Follow Up
Document, using just a letter or a form provided by the credit bureau, and dispute any item that looks incorrect or misreported in any way. Include supporting documents and keep copies. The credit bureau must investigate any relevant dispute within 30 days and if they can not obtain verification from the creditor, they will remove the item from the credit report.
Contact Creditors and Stay Focused
After the dispute process, contact any creditor (including collection agencies) that has reported a delinquent payment or account, and negotiate a settlement or payment plan. Upon agreeing to a payment arrangement, get it in writing - especially if it’s a collection agency. Also, include an agreement that the creditor will communicate all settled debt with the credit bureau. Stay focused, don't avoid issues, and stick with the plan.
Don’t Accumulate More Debt, Pay Your Bills on Time
Avoid more debt. Pay all bills on time and speak with creditors if a payment is late or missed. People are often tempted to get a bad credit loan or a short term cash advance to pay off old bills. These loans are designed for life’s emergencies so understand all terms and consult a qualified financial advisor with questions. Don’t move the ball backwards, move it forward!
Build a Credit History
The next step is to fix a bad credit score. Critics consider this step as controversial so it is not advised without the right level of discipline. Apply for and get a credit card and then pay it off, in full, every month. Use it minimally just to establish a successful payment history, and not as a bank! As creditworthiness and credit history improve, so will a credit score.
“Over 25% of the people in the US are now classified as having bad or poor credit,” explained Chloe Mulliner, Editor at CreditSources. “Even with terrible, horrific credit, all hope is not lost! The sooner someone gets back on a path of fixing their credit issues the sooner their credit score will improve. The two are directly linked.”
CreditSources.org is a leading authority site on credit related consumer services, personal finance, unsecured personal loans for people with poor and bad credit, credit sources, credit cards, and all things credit.
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