It should come as no surprise that this isn’t exactly the best time to be taking out a loan for a large purchase such as a car, a boat, a home, or a business. The lasting result of the mortgage lending crisis (besides the trickle-down effect) has been an overall tightening of the proverbial purse strings at banks around the world, leading to fewer loans (and lesser amounts) even for those who appear to be eminently qualified. On top of that, you may have suffered a setback where your credit rating is concerned if you lost a job, defaulted on a loan, or otherwise fell short on payments due to the poor economy. And a credit report besmirched with black marks can definitely prove detrimental when you go to get a loan, even if your history is largely unblemished. So what can you do to boost your credit score in order to get the loan you desire? Here are just a few ways to buff out the black marks and get your credit back in fighting form.
1. Get a copy of your credit report. Until you know what your score is and you ascertain why it is low, you can do nothing to correct the situation. Go to Annual Credit Report to get a free copy mailed to you or visit free score.com to view it for free online. This report will not only reveal your current credit score; it will also provide valuable information from creditors that can give you clues as to why your score is lower than you’d like (late payments, debt that has gone into collections, and so on). It may even show that you have been the victim of identity theft or other forms of fraud, which you’ll need to address in order to repair your credit.
2. Pay off debt. This is, of course, the best way to improve your credit score. But most of us can’t reasonably do this very quickly, especially if we’re paying for big-ticket items like a car or a home. However, you may not be aware that you’ll actually build credit faster by simply paying on time. Even if you only pay the minimum each month, as long as you pay on time and meet the requirements of your lenders, they will report favorably on your progress, improving your overall rating.
3. Use online bill pay or set up reminders. If you can’t seem to remember to pay on time, then you have no one to blame but yourself for a poor credit score. Accept procrastination as one of your many flaws and take the steps necessary to combat it by arranging for automatic withdrawals from your account. Or if you don’t want to relinquish control, set up an online reminder through your bank so you get an email when payments are due.
4. Contact creditors. The only way to clear up black marks (especially erroneous ones) is to contact creditors to clear up the issue. Often one phone call is not enough. You will have to be vigilant about monitoring the situation if you want to get the deed done. Even if you have paid your debt and expunged the source of a black mark, it may still appear on your credit report; while lenders are all too happy to report bad behavior, they are not so quick to clear the matter up at your behest. So be proactive and call as many times as you have to in order to clear your credit.
5. Don’t let it go to collections. Sometimes there is nothing you can do about your debt. Job loss, in particular, could mean that a lot of your debts end up in collections. But if you can find any way to avoid this turn of events, you should, because accounts that have gone into collections will remain on your credit report for seven years, even after you pay them off.
Shirley Simpson writes for TotallyMoney where you can find information on financial products and browse through information on over 60′s life insurance to find the card that meets your needs.
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