Monday, March 18, 2019

Tips for Improving Your Credit

Did you know that over 30% of Americans has bad credit? Regretfully, I am one of them. If you are too, I feel your pain. Clearly, I am not the credit guru to be taking all your advice from, but I do have a few tips that might help make the burden a little less heavy.

First and foremost, don't panic. It's not something to take lightly, obviously. But getting upset and stressing yourself our over it is not going to accomplish anything. In fact, that kind of stress and panic could be counter productive. If you believe it is hopeless, you likely won't even bother trying. It's not hopeless. Stay calm and handle it.

Next, know why your score is low. Check your credit report. You can request a free copy of your credit report from each of the 3 major credit reporting agencies (Experian, TransUnion and Equifax) once per 12 months. These are credit reports and do not include your credit score, but that is easy to find online (for free) many places.

Once you know what you supposedly owe, you can dispute the debts. There are sites you can use to contest the validity of a debt. Many people are reported as owing debts they never should have owed. This could be from mistaken identity or identity theft (simple ID theft, like an ex roommate or something ordering Columbia House [throwback, right?] in your name.) You can even contest debts that were your own.

This is because old debts are often sold for pennies on the hundred. That is why you got offers to settle for much less than you owe, because the original lender wrote your debt off. They sold it to someone for, say, $2. Anything above that $2 is all profit for the agency that bought it. Often when a company sells the debt, they don't send all the records/proof, whatever. When you contest the debt, the debt-holder has to prove how you acquired the debt. If they can't produce proof, the debt is removed.

For the debts you cannot have removed, try to negotiate. As I said, if the debt has been sold off, anything over what they pad for a debt is profit. So if you owed $600, the agency my offer you to pay it off for $450 (you get letters n the mail) but you could likely negotiate down even further. Because making $300 is better than never getting paid anything, which is what happens a lot of the time.

Another way is to build new credit. That is clearly difficult to do when your credit is low, but it's not impossible. There are bad credit loans out there. Knowing your options is very important. Having bad credit is hard. I's unpleasant, but it does not devalue you. Don't allow yourself to be taken advantage of or treated with disrespect because of it. Use all the resources available to you. Be confident. Be in control. You've got this.

No comments :

Post a Comment