How to Overcome A Bad Credit History

Recent worldwide economic situations not just in the U.S. have left many people in a poor financial state. A great number of people lost their jobs by corporations downsizing or by companies closing altogether. The inability to find new employment has created havoc for many people. You may be one of those affected and your may have to deal with a bad credit history as a result.

If this is your situation, you do not need to despair, there are ways to overcome a bad credit history. The ideas below will point you in the right direction and help you to get started on the path to repairing your credit history.

Of course, the easiest thing you could do to repair your bad credit history is to pay your monthly bills on time. If it is possible, pay each bill in full before the due date. Doint just this one thing can have a tremendous positive effect on your credit history.

Next make a list of the amount of debt you have on each credit card or loan. Put any extra money you may have toward paying off the smallest amounts first if possible. Your goal is to lower the amount of debt you have in relation to your available credit. Paying off as many balances as possible will help toward creating a positive credit score.

If you have a large number of balances then you may want to consider credit card or debt consolidation. An important thing to watch out for, however, is that your interest rates will not increase substantially after the first 6 months.  Many companies offer consolidation at really low introductory rates, only to hike them after the introductory period is finished.

If you find yourself having to use a credit card from time to time, then be sure that you do not max it out. Maxing out your credit cards will definitely hurt your credit rating. Do not use the credit card once you have reached 75% of your available credit.

Remember, you are entitled to free credit reports each year. Take advantage of them.  Look at them carefully and try to have any errors removed.  If there are any debts on your credit report which are older than 7 years you can ask the credit bureau to remove them. This only applies to debts for which it has been 7 years since the date of the last inactivity on the account, not the date when the account was first created.

When you are suffering with a bad credit history it is very easy to just want to throw in the towel and give up. Don’t!  Just start implementing some of the steps above and your credit rating could start to improve within 60 – 90 days.  You also may find it helpful to use a credit repair company to help you regain your good credit.  You will want to be careful to get a reputable company, but a good credit repair company can be a tremendous help.  Click here for a government report on How to Recognize a Credit Repair Scam.

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