7 Ways to Increase Credit Rating

7 Ways to Increase Credit Rating

Millions of Americans have bad credit or have had trouble with creditors at some time in their lives.  Too often the reason for bad credit and poor credit ratings is credit cards.  Credit cards are responsible for most of the bankruptcies in the US.  The only other thing that leads to as many bankruptcies is medical bills.  There are ways to increase credit rating so you can get a fresh start with your credit.  There is no longer a reason to stress over poor ratings if you take a few steps toward credit repair.

Ways to Increase Credit Rating – Copies of Credit Reports from Top 3 Credit Bureaus

The first thing that you need to do is to get copies of all the credit reports from the 3 major credit bureaus.  It is actually possible to get copies for free from some of the credit bureaus once a year.  Until you have a copy of these reports, you won’t know what you have to do to correct your credit rating.  Therefore it is worth a little cash to get them as soon as possible.  Once you have credit reports, you will be able to see what creditors have been reporting late payments or delinquent accounts.  You will also be able to see if there are any errors on your credit reports.  There is always a good possibility that there will be one or two errors.

Errors don’t mean to dispute the wrong address or even the wrong spelling of the name.  What you need to watch for is late payments that were made on time.  Sometimes creditors will make mistakes and report a late payment when it was actually made on time.  These are the sort of things to dispute.  Credit reports will also help to check for identity theft.  If you think there is a case of identity theft then you should contact the credit bureaus immediately and report anything that is wrong including the name and addresses.

7 Ways to Increase Credit Rating – Past Due Balances Should Be Paid for Credit Repair

If you currently have any past due balances you need to get them caught up.  35% of your credit rating is made up of your payment history.  That means every time you pay late it will have a big impact on your score.  As you fall behind further, your credit score will drop even more.  You also want to prevent any past due credit card payments from going into collections.  You can also try talking to your creditors about past due payments.  When you pay several months in a row on time they may be willing to allow a late payment to be taken off of your credit report.  This can be a big help to you when looking for ways to increase credit rating.

One of the Ways to Increase Credit Rating Is to Avoid Purchases on Credit

Whenever possible you should make cash transactions.  Avoid charging anything right now while you are trying to correct poor credit ratings.  When you have high balances it will have a negative impact on your credit rating.  You are also trying to get out of debt and in good standings.  This will be difficult to do as long as you are still using your credit cards or buying on credit in any way.  Although you may want to make the purchase, if you can resist even paying cash, you should.  Use the money to pay on your credit cards.  You may even be able to afford to pay one off in full.  Also the lower your balances are the better your credit rating will be.

Ways to Increase Credit Rating – Pay Off One or More Debts

If you seriously want to get your credit ratings down, you will have to pay off a debt or two.  This can be difficult for many people.  You may have to sell your possessions to do this.  That may seem extreme but if you want your ratings to go up you will have to do this.  When your credit ratings go up you will feel better about selling your items.  You need to know that 30% of the credit rating is decided by the debt that you owe.  Once your credit rating has been repaired you can then start to buy, with cash, the things you had to sell.

Ways to Increase Credit Rating -Call Your Creditors

No one likes to talk to their creditors when they are behind on their payments.  If you have gone through a bad spell and cannot meet your payments, there are hardship programs that will let you pay lower payments.  Once you are able the payments will then go up.  By then you should be able to hold your own.  Creditors will try to work with you.  They can lower monthly payments, forgive late fees and even lower the interest.  It is in your best interest to contact them.  Often when you call them they see that you seriously want to take care of the problem.  They do not have to call and harass you.  This sits well with them.

Call a Professional when Looking for Ways to Increase Credit Rating

Don’t be afraid to ask for help from a credit counseling agency.  There are several that are reasonably priced and can be a big help to you.  Many people just don’t know where to begin and become overwhelmed by the whole thing.  They want to repair their credit but don’t know where to begin.  Your billing statements from your creditors will have names of credit counselors on them.  You can also use the internet to find help.  Try the National Foundation for Credit Counseling.  They will be able to assist you with your credit ratings by telling you what to do and when to do it.

Ways to Increase Credit Rating – Don’t Expect Miracles

One of the 7 ways to increase credit rating is to not expect miracles.  You took a while to get into debt and behind in your payments.  Your credit rating didn’t drop overnight so don’t expect it to be fixed overnight.  It will take some time for there to be any noticeable change.  You will have to get caught up and get your balances under control first.  You will have a lot of work to do before you will notice any change.  If you do everything in your power and see no change get in touch with your creditors and definitely get help through a credit counselor.   It probably took years for your credit rating to become poor.  It will take several months for it to improve.

Once you have used different ways to increase credit rating and succeed at it, do what you can to stay out of debt.  Just like before you can end up with a lousy credit rating again.  That will mean higher interest rates and a hard time getting loans and credit.  Refrain from using your credit cards any longer.  If you pay with cash you don’t have to worry about extravagant interest rates to pay.  You also won’t have to worry about monthly payments that will have to be made on time.  Granted there are times you will need to make purchases using credit.  You will need it to buy a new car and a house.  As long as you have a good credit rating you will have affordable interest rates on both of these.  You now know how to do credit repair and improve credit ratings.