Fixing your bad credit can be a long process, but it is possible to do it without spending a fortune. If you’re looking for a way to fix a bad credit score without resorting to calling a Chapter 13 attorney Miami, then try these five suggestions.
1. Get a copy of all of your credit reports, and check them for errors.
A recent study showed that nearly 90% of all credit reports contained some kind of error. While not all of these errors effected a person’s credit score, it’s worth making sure that your credit report doesn’t have any bad information that is being used against you. At the very least, bad information will make it more difficult for you to confirm your own identity.
2. Make a list of your bad accounts, and try to get them paid off.
Before starting on this, make sure you get agreements in writing that bad information will be removed from your credit report if you pay. There is no guarantee that a creditor will take the information off your report without this agreement.
3. Consolidate the debt you have, but don’t close your old accounts.
Take your existing credit cards and personal loans and transfer the balances to other cards with lower interest rates. This will allow you to pay more on the principal every month instead of on interest. As you pay off the debt, your credit score will improve. Banks like to see that you are making progress towards getting your debts paid off.
4. Open new credit accounts, but don’t use them a lot.
This work on the same principal as #3. A big part of your credit score is drawn from the ratio of the amount you owe to the amount of credit that you have access to. By increasing the amount of credit you have access to, your score will increase.
After waiting for several years, a lot of the bad information on your credit report will fall off. That means that if your score is being brought down by mistakes you made a couple of years ago, you’ll see your score improve every six months until the mistakes drops off or disappears. While this might not be the most convenient option, it’s important to keep in mind. Every six months check your score and see if you qualify for better interest rates on your current loans.