Free Credit Repair Strategies

2019/02/25

Are looking for free credit repair strategies? Collect some here. Show them that you have the habit of paying your bills on time. If you do, it alone will improve your credit score. And, creditors will trust you when you apply for a credit card, a car loan or a home loan.

If you default on your payments, they will think twice about lending you any money. If your credit score is very low, it is because you have several dozens of late payments and missed payments in your financial history. Oh, no. I am not beginning to sound like your mother in law. I was simply telling you how you have ruined your credit. I will also give a few simple, doable ideas to rebuild your credit. Yeah, free credit repair strategies, of course.

Free Credit Repair Strategies

If you have bad credit, don’t apply for a home loan or a car loan until after you have repaired your credit. You can repair your credit in less than one year. The simplest strategy is to pay your bills on time, every month. Your creditors are required to report your payment history to the credit reporting agencies (Experian, Equifax and TransUnion).

Timely repayment (or non-payment) is the biggest factor determining your credit score. It has a weightage of more than 30% on your credit ratings. If you have the habit of forgetting bill payment dates, you can automate your payments. Automating your payments will help, even if you have problems remembering the payment dates. It saves you time. You will also never miss a payment.

This is the best strategy to build your credit. And to repair your credit if it is damaged. Don’t forget to pay your bills on time. You can automate payments to your credit card. Set up your checking account to pay your credit card bills on time. When the creditors report that you make the payments on time every month, your credit ratings will go up. Making timely payments is simple. However, when it comes to credit repair, this alone may not be enough. You need something more.

Credit utilization rate (or is it credit non-utilization rate?) another big factor determining your credit score. If you have big lines of credit available and you only a very small portion of it, your ratings will be higher. If you utilize most of the credit, your credit ratings will go higher. If you utilize most of the credit available in those lines of credit, your credit ratings drop.

Is there a trick here? Yes. You can increase your credit ratings by increasing available lines of credit. The simplest method is to increase credit limit of your credit cards. If you have been making timely payments, credit card issuers will have no problems enhancing credit available to you. However, don’t go on a spending spree simply because you have lines of credit open.

If you have $10,000 available in all lines of credit and if you utilize less than $1000, it will reflect positively on your credit files. The credit reporting agencies will think the creditors trust you. Most importantly, you will improve your credit ratings. However, don’t open new credit card accounts. Going on opening new credit cards will only destroy your credit ratings. The key is to increase credit available in existing credit cards and other lines of credit (without actually using them).

Before you apply for a big loan like a home mortgage loan or a car loan, you can further improve your credit ratings. Variety in your credit history is another factor determining your credit score. You can add variety by taking a small personal loan or a consumer loan. The goal here is to get stellar credit ratings before applying for a major loan. Make monthly payments on all the loans. It will show that you are capable of managing payments.

For your information, the length of your credit history also has some weightage on your credit score. However, you have very little control over this factor. If your credit history is only four years old, you need one more year to make it five years old. Use these free credit repair strategies to your advantage. Pay all your bills on time, increase total credit available to you and add diversity to your credit profile.

There is also one more thing you can do. It is preventing mistakes creeping into your credit files and ruining your credit. More than half of all credit reports have a mistake in it. Request a copy of your credit report. Then learn to identify the different entries. When you spot a mistake, ask your creditor to correct it. Don’t expect to remove an accurate and timely entry.

In most cases, your creditors may send inaccurate reports to the credit reporting agencies. Don’t let their mistakes cost you. Working towards a great credit gives you immediate benefits. When you don’t miss a payment, you will avoid paying fines and late payment charges. Almost every bill you pay come with late payment charges. Avoid such charges and you can make significant savings every month.

Credit card interests are simply too high. You can use a credit card without every paying any interest. You won’t have to pay any interest on your credit card if you pay your bills in full. However, if you pay only minimum, it will cost you interest. If you have good financial sense, you will pay your bills in full, every month.

Your ruined credit history shows your financial behaviour has been less than perfect. It took time to get a very bad credit score. You also will need some time to get your credit history back on track. Don’t attempt any fancy tricks. You can’t trick the system. Play according to the rules. Stay committed to make monthly payments of all your dues.

And try to enhance credit limits the legal way. Then challenge any inaccuracies that draw your credit score down. Once you have good credit, it is your time to apply for big loans (car and home loans). You will qualify for low interest loans, saving you hundreds to thousands of dollars every year of your paying back the loans.

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