Many people are throwing up their hands in frustration wondering how can I fix my credit? In these hard economic times, with job losses at record levels and businesses having to close their doors due to people spending less (because they’re flat out keeping a roof over their head and putting food on the table), it’s easy to get into trouble financially with credit cards and be late with mortgage payments.
Before we know it we have a couple of late payments on our credit report and our credit score is taking a nose dive. What to do? How to fix credit before it spirals out of control?
Well you’ll be happy to know there are a number of things you can start doing now in order to fix my credit score, and the sooner you start doing them the sooner your credit score will start climbing up again instead of spiralling down.
The number one thing you can do to fix your credit is to go through your credit report and get any errors off there. You’re entitled to a free credit report every year. That’s right; you don’t have to pay for them like some unscrupulous websites will have you believe. They won’t cost you a cent and you can order them through annualcreditreport.com. That’s a legit website that is sponsored by the three large credit bureaus; Equifax, TransUnion and Experian.
You could have errors on your credit report that are costing you points on your credit score. You could have inquiries on there that weren’t made by you; mistakes get made by data entry people; identity fraud is on the rise, so you should be making it a habit to check over your report at least once a year. It’s not going to cost you anything, and removing any inaccuracies off your credit report can bump up that credit score to a nice healthy figure.
The next thing you can do to fix your credit score is to start paying your bills on time. I know…you’re thinking ‘well I already knew that’….but are you DOING it? Look, the credit reporting agencies base over a third of your credit score on your payment history. That’s a big percentage based on just how well you pay your bills. It is easier said than done when times are tough, but if you are really serious about fixing your credit, you’ve got to do whatever you can to start getting those bills paid on time.
You might have to draw up a budget and STICK to it. Even if you have to eat beans for a week from time to time, do whatever it takes to get those bills paid by their due date. I have an article here on budgeting tips that can help you stick to this important practice. You can completely turn your credit problems around by starting to pay those bills on time. Over a period of time, once any late payments items come off your credit report, you will be rewarded with an increased credit score that will never be affected by a late payment item showing on your credit report again. Do what you can to make sure that no more late payments ever show up on your credit report again.
The third thing you can do if you are having problems paying your bills on time or with late payments is to get in touch with your creditors and explain your situation. So many people just couldn’t be bothered doing this, yet it can help take a lot of pressure off you if you can arrange to have your repayments lowered to a level you can afford and that will also keep the creditor happy and off your back.
If you take action and follow the ideas mentioned above you will be well on your way to fixing your credit. It won’t happen overnight but it will certainly start shifting things around for you, so you will never have to lament over the words ‘how can I fix my credit‘ again.