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Each day, millions of people throughout this country struggle with the effects of having a bad credit rating. Some are turned down for credit cards or vehicle loans, others learn their applications for a mortgage loan have been denied. If you are experiencing the restrictions that can result from having poor credit, you may already realize that your credit score is in need of repair. These days, getting information about how to fix your credit score doesn't have to be frustrating or stressful, thanks the abundance of financial resources available to consumers. The first step in taking control of your credit situation is learngin what information is listed on your credit reports. You can do this by ordering your credit reports for free from www.AnnualCreditReport.com or by calling 1-877-322-8228. This service is provided by Equifax, Experian, and TransUnion, the country's three largest consumer credit reporting agencies that maintain and distribute your credit report. The Fair Credit Reporting Act entitles you to receive, by request, a free copy of your credit report from each of the credit bureaus once every 12 months. Tips to Increase Your Credit Based on the information in your credit reports, credit scores are an important tool used by lenders to calculate the likelihood that a borrower will repay a loan. Fortunately for those with lower credit scores, this rating is not set in stone. there are things you may be able to do to improve your credit score. * Pay your bills on time - Payment history makes up 35 percent of your credit score. A period of not making your payments on time can quickly drop your score but since the effect of a late payment diminishes over time, focusing on making all payments on time going forward will move your credit score in the right direction. * Get current on missed payments - If payments are already delinquent, their impact on your credit score will become increasingly more devastating the longer they remain unpaid. A couple of 30 day late payments are excusable, but just one 90 day late payment can cause your score to come crashing down. * Contact your creditors if you are having a hard time making payments - If you foresee that you will be unable to keep current on your payments, you may be able to make arrangements with your creditors such as extending the loan period that will help you get back on top of things. In the end, you could end up paying more, but if it keeps you from getting further behind, it will be worth it for your long term finances and for your credit rating. * Try to keep low balances on your credit cards - Outstanding debt makes up 30 percent of your credit score. The closer you are to reaching the limit on your credit cards, the less stable your finances will appear. Keeping credit card balances below 30 percent of the available limit will make your utilization ratio look better which is a good thing in the credit scoring model. * Avoid shifting your debt between credit cards - Transferring debts to a low interest rate card is a solid strategy when working to pay down debt, but a history of moving balances between credit cards makes it look like you are robbing Peter to pay Paul in lieu of of being able to make your monthly payments. * Carefully study loan or credit applications before accepting them - Some loans, including retail store lines of credit, are loaded with strings attached that can end up causing big problems down the road. For example, some no payment, no interest financing programs offered by retailers include interest rates that can skyrocket if you are late on a single payment and clauses where you may still be responsible for making payments on interest calculated during the "no interest" period. * Use your credit cards responsibly - Keeping balances low is a start, but you should also be careful to keep the number of cards you have in check, make all payments on time, occasionally use older cards, etc. For the most part, best practices for all credit accounts apply to credit cards as well but given the tendency people have to let their credit card spending get out of control, responsibly using credit cards warrants special attention. Finally, for people who need additional assistance addressing their bad credit, an excellent resource for consumers are professional credit repair services. Professionals can provide their valuable expertise on important matters like disputing the questionable negative listings on your credit report and specific steps you may be able to take to make the most of your credit.
Credit Repair Thoughts: http://www.creditrepairthoughts.org
More information about credit and steps people can take to improve poor credit can be found by visiting Lexington Law's Credit Education resources. More information about Lexington Law can be found at www.LexingtonLaw.com
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