CREDIT REPAIR

Dealing with any type of stress can be difficult, but dealing with financial stress can add to your already pressure-filled existence. As soon as you realize financial stress is a problem, it’s good to start relieving the pressure. However, you need to know where the stress is coming from. So let’s look at some common causes of financial stress and how you might deal with them.

Debt

We’ve been getting a lot of questions about how debt repair really works. Sometimes, it can be tough to know exactly how to get out of debt, so we asked a company, Simplified Debt Solutions, to give us the 411.

Understanding Your Debt

Many people, when they first get a credit card, tell themselves that they can handle the temptation that their credit cards represent. They firmly believe that there’s no way they’ll let themselves get into trouble with one – and then they get to the store and see the $500 leather jacket or the sunglasses or the running shoes or the brochure for the cruise to Tahiti.

Credit cards let us get many of the things we want when we technically can’t have them because we can’t afford them. As such, they’re very tempting to use and abuse, and many people rack up enormous, critical debts with them. Unfortunately, credit card debt - when it gets bad – will reach out and affect every area of your life. If you think the resulting bad credit report and bad credit score won’t bring you down, think again.

If you’ve got bad credit, or credit that’s less than perfect, the first thing you need to do is relax, and stop internalizing any negative feelings you might have about it.

Plenty of people — especially in these trying economic times — have made credit mistakes, so you’re in very good company. Be sure to keep that fact in mind as you negotiate your way back to a better credit history and rating. Although it’s very important, confidence is just one weapon in your arsenal and should be used along with others in proper measure. Read on if you’ve got bad credit and are looking for more ideas and tips for negotiating your way back to a better place. 

Step 1: Get your credit score

Most American average at 723 on their credit score. The higher the credit rating the better the interest rates on your credit cards, car loans, and your mortgage loans as well. With the importance of your credit scores weighted so heavily it’s important to be aware of the top factors that affect your credit score so that you can check your credit report for accuracy.

Top 3 Ways to Raise your Credit Score

The way lenders determine your “credit worthiness” is through the FICO credit score formula, however that formula has changed. To get better deals on your mortgage loan, auto loan, or even your cell phone contract – your new FICO score will now determine whether you get that better deal or not. With the new changes, learn how your credit score has changed significantly.

The company that pioneered the FICO scoring system, Fair Isaac, stated that the new scoring system is more accurate than the older system. With the new FICO scoring system here – take a look at the impact that it may have had on your credit score.

Changes to the original FICO scoring system include:

Having a good credit score is important. It affects your every day living. When you go look for a place to live – landlords check your credit to see if you will be capable of paying your rent on time. When you go looking to get a loan – whether you get approved or not, your credit score is used to determined this. So it is important to definitely take your credit score seriously. Although there are many ways to help improve your credit score, the easiest way is by having credit cards.

The housing market is calling and you want to get ready to answer. You have already worked on building a sizeable down payment, have crunched numbers to know exactly what you can afford and now need to work on improving your credit score in order to get your lowest mortgage rate possible. Improving your credit score takes financial discipline and that will ultimately affect the amount of time it takes to raise your credit rating. You should give yourself several months to thoroughly address the task at hand.

Like Rome, credit ratings were not built in a day. To understand how to improve your credit score and why the process may take several months, you need to grasp the core system that establishes your credit score in the first place:

If you know your credit report contains details that may result in you not being approved for a loan, car or home, it may be time to contact your creditors to make some repairs. It may feel a little scary to contact these agencies, especially if you don’t have the full amount to pay them; however, they are usually prepared to strike a deal with you, so it’s truly worth the effort.

Why You Should Clean Up Your Credit Report

If you’re wondering whether collection accounts from companies or agencies you owe will show up on your credit report, the answer is maybe. It is typically up to the company’s discretion to determine when or if they will report any negative activities to one or all of the three credit bureaus. However, there is usually a better chance than not that your accounts will show up.

Why Are Collect Accounts Reported?