5 Steps To Reclaiming Your Credit

You are certainly the only  American who deals with credit card debt issues – or any debt, for that matter. Secured and unsecured debt are facts of life in the modern age, and it’s easy to fall behind on payments due to the ever-growing financial demands of life.

Although top rated credit repair services aren’t guaranteed, undergoing credit repair is still one of the best options available if you’ve got delinquencies and other unresolved issues with your account. There, of course, a few preliminary steps you can take to better position yourself; here they are.

1. Order Your Credit Scores

You’ve got to know what it is you’re seeking to improve, right? By checking the credit history you have on file, you can spot any mistakes; fixing these may help drive your out of the subprime region into the near-prime or prime level, where the best interest rates on loans reside.

Fortunately, the federal government makes it easy to order your credit reports; you can get them for free every year from the three primary credit bureaus: Experian, Equifax and TransUnion. It’s best to obtain one from each, so that you can cross-reference them with each other and locate discrepancies.

2. Consult a Reputable Credit Repair Agency

As a rule, you want to take a look at the federally-mandated Credit Repair Organizations Act, which works to ensure that consumers aren’t defrauded by crooked agencies claiming to engage in credit repair. For example, one of the things it covers is the length of time a delinquency can remain on your account: 7 years, in general. If you receive a claim from a credit repair agency trying to charge you to fix a 7 year-old bill, then you know that this agency is untrustworthy.

3. Resist the Temptation to Close Credit Accounts

You can cut up credit cards if you want; but do not close the account! Why not? Because the length of your credit history is a contributing factor to your FICO score; the longer you’ve had an account, the higher your score will be. With so many credit cards out there, it can be tempting to see which ones you qualify for; however, although your credit utilization score will benefit from having more credit available, the multiple inquiries you make diminishes the score.

Sometimes, however, a payment plan that you’ve set up with the company may necessitate account closure. In these cases, then you have little choice but to comply.

4. Watch Your Credit Utilization

More specifically, reduce the percentage of credit you’re using compared to what you have available. A good average number is 36%; this positively affects your credit score and gets you on the road to prime creditworthiness. Besides; paying down your bills is one of the best ways to see a steady rise in credit score.

5. Consider a Secured Credit Card

With a secured credit card, you have interest rates to deal with, and you may not be able to get one if your credit is really poor, since these rates are a reflection of your reliability. A secured card, on the other hand, tends to be a lot easier to obtain, since you put money as collateral. The funds are already in your account, and so you cannot really default on it.

The other benefit to the secured card is that your payments are reported to credit bureaus every month, giving you a chance to see real change in your FICO score relatively quickly. Just make sure you make the payments on time, every time.