Struggling with a low credit score? Our guide to credit repair is just the thing to help you get your finances back on track. We’ll show you six simple steps that can help you raise your score, from disputing errors on your report to correcting outdated information.
1: Obtain A Copy of Your Credit Report
The first step to repairing your credit is to obtain a copy of your credit report. This will provide you with a clear snapshot of any areas that need improvement and allows you to identify errors or misleading information. By law, you’re entitled to one credit report every year so make sure to take advantage of this offer to ensure the accuracy of your reports!
2: Dispute Any Errors in Your Report
Once you have a copy of your credit report, it’s important to dispute any errors or misleading information. This can help improve your score by removing any negative entries that aren’t accurate. To begin the process simply contact the creditor in question and explain why you believe the account is inaccurate. Make sure to provide proof if possible, such as pay stubs or statements that show you paid the balance in full. If successful, the creditor will have to remove the erroneous entry from your credit report.
3: Pay off All Outstanding Debts
Paying off any outstanding debts you have is an important step in emergency credit repair. Try to make sure that you focus on accounts with the highest interest rate or those close to the credit limit first. Even small payments can help reduce your debt, so start by making minimum payments and working up from there. It may also help to reach out to creditors as some companies are willing to waive late fees or set up a new payment plan depending on your situation.
4: Lower Your Credit Utilization Rate
Credit utilization is another factor that affects your credit score and it’s a good idea to know how much you should use. Ideally, try to keep your credit utilization rate. This means you should only use of your available credit at any given time. If you’re having trouble keeping this rate low, one way to tackle it is by asking for an increase in your credit limit so that the ratio remains within acceptable levels.
5: Review Unpaid Accounts and old Debts That Appear on Credit Reports
Now that you have a better understanding of your credit utilization ratio, it’s time to take a closer look at the unpaid accounts and old debts that appear on your credit report. Go over each entry carefully and figure out why the account has gone unpaid. Once you determine the cause, contact the creditor and find out if you can set up a payment plan or negotiate a settlement so that you can start paying off these overdue balances and get them removed from your report soon.