So your credit stinks. Maybe you have a bankruptcy, or maybe your credit has tanked from some unfortunate decisions. Or, maybe it’s something more innocent, such as a few missed car or rent payments. Bad credit affects your life, from rent applications, car loan applications, and even merchant loan applications. Whatever the reasons, consumers want to know how they can repair their credit – legitimately repair their credit. Well, there are steps that you can take to do so – but they aren’t a quick fix.
First off, you need to know what’s on your credit report. Sites like CreditKarma can provide you a free report yearly – and you need to review it! Sometimes an old or faulty item is mentioned on your report that should be removed, and removing this can perk up your credit score. It’s worth the look for that.
Credit reports contain information about many of the bills you have now or have had in the past. Credit card bills, car loans, mortgage loans, even medical, utility and other bills are often contained within a credit report. Here are some things that can indicate bad credit on a consumer’s credit report:
- payments made over 30 days late
- bills that have been turned over to a collection agency due to non-payment, even if you weren’t aware you owed the bill
- loans that you’ve co-signed on for someone else that haven’t been paid in a timely manner
- credit cards with balances over 70-80% of the total credit limit
- a high dollar amount total of credit cards owed on
One big issue that can hurt a credit score (whether you are a consumer or a merchant) is if your credit card is getting towards its limit. Credit cards can help you build credit – but spending can become out of hand, and you are in a jam.
Traditional providers are not equipped to deal with many business types and industries. In an effort to protect their interests, these “high-risk” merchants are turned away. Gaming, nutraceutical, credit repair, telecom, warranty, travel, restaurants, hotels, eBooks, electronics and airlines are just a few of the business types and industries providers consider high-risk.
Getting back to the actual credit report… if you see an item that is labeled “written off”, that is a charged-off item that will affect your score – but the company doesn’t expect to get paid. It’s important to contact these creditors, pay those bills and ask them to change the report to indicate that you’ve paid the bill. It’s also important to pay off any bills that have entered into collection status.
If you see an item or items on your credit report that are incorrect or simply don’t belong to you, contact the listed creditors or collection agencies and work with them to get the errors resolved.
If you find that your credit report contains fraudulent information or that your identity may be stolen, contact your local police department and work with a reputable fraud resolution company to stop the fraud attempts in their tracks.
Cleaning up your credit can take work, but the benefits that result from having a good credit report will be well worth the effort.