Having a bad credit score can negatively impact many aspects of your life in ways that you cannot imagine. For instance, getting further financial assistance from financial institutions in order to do something like starting a business or buying a home is almost guaranteed not to work out. A bad credit score is not something that you want to live with for any period of time. It can also get you out of a magnificent job offer, as it will show employers that you are not able to discipline your financial life, meaning that you would probably not perform at your job.
The good news is that there are many ways and steps that you take to repair your own credit. While some people would want the help of credit repair companies in order to achieve this, the truth of the matter is that it is quite possible to do your own credit repair simply by following the tips and suggestions listed down below:
- Ask for audited reports so as to have a full picture of your credit situation
The first step in your credit repair strategy is to get an accurate description of the entire situation. This will involve you asking for free audited reports from the many credit report agencies that are available on the internet and are legally sanctioned to provide this type of service. This report will show you the amount of money that you have been spending and on the things that you have splurged on.
- Erase as many negative items from your report as quickly as possible
Under the fair credit reporting act (FCRA), you are entitled to challenge any credit errors that you might see on your report. This will range from bad spelling to incorrect amounts that have suddenly been slapped on your credit cards. Since the credit bureaus are extremely busy agencies, any challenges are simply struck off from your credit report, thus leaving you with a lot less debt to start paying down. This should motivate you to kick off your credit repair strategy by combing through all your reports and challenging each item that you find is inaccurate, even in the slightest way.
- Clear all late payments first
The next thing on your list would be to start paying off all your late payments. Late payments have a very negative effect on your credit score, and dealing with them first will go a long way in boosting your score. From the moment that you clear the late payments, you cannot allow yourself to get late on repaying your credit card monthly payments again. Once you have done this, your credit situation will now start to resemble that of a normal individual with an average credit rating. Your credit repair process will be on the verge of success.
- Pay off the amounts with the highest interest rates first
You will also need to set aside a large amount of money from your monthly salary so that you can use this amount to pay off all your debts. after you have paid off all the minimum monthly payments to all the credit cards that you own, the next step would be to take any extra money you have lying around and putting it to work paying off the debts with the highest interest rates. This will reduce your debt obligations tremendously.