Credit in the U.S. has become so common that a credit score is now a significant measure of one’s financial health. It communicates your level of responsibility in using credit and helps them determine your creditworthiness. A higher credit makes it easier to obtain loans and opens the doors for low-rate loans. If you have bad credit, there are several things you can do to change it for the better. Here are a few tested-and-tried measures:
- Dispute inaccurate information
It is not uncommon for credit reports to carry information that is riddled with inaccuracies. Start by identifying and eliminating them. In case you didn’t know, you’re entirely within your rights to dispute an inaccuracy, and the credit bureau has the responsibility to investigate your claim and make changes accordingly. Unfortunately, poring over credit information alone isn’t an easy task, and your lack of familiarity with financial terminology may have you missing helpful information on your report. This means you may need to involve a credit repair company like EMS Prime Solutions to review the reports and repair your bad credit.
- Pay your balances
Once the inaccuracies in your credit report have been removed and gotten a clearer picture of your financial health, make plans to pay down any debts you have. Your credit score is primarily dictated by your accumulative debt and the utilization rate of your credit cards. By paying down your balances, you lower your utilization rate and increase your credit score.
- Get in touch with your creditors
Many consumers believe that failure to make a payment automatically invites an inevitable consequence, but that is not the case. Most creditors are very willing to agree with you regarding a change to any earlier-agreed terms of repayment. You only need to be proactive about it and contact them before the payment due date. Even if you don’t, creditors will only report a missed or late payment if they are at least a month overdue.
- Refinance your debt
Refinancing is the best option if the primary source of your debt problem is the high-interest rate you are facing. Take the time to find a refinancing company that can take all your debts and give you a single loan at a lower rate.
- Automate your payments
Creditors may forgive one or two late payments, but they will likely report you if you become a repeat offender. Many repeat offenders happen to be people who forget to track their payment schedule rather than lack money to clear their debts. You can get around this by automating your payments. All you need to do is make arrangements with your bank to pay certain institutions specific amounts of money each time income reflects in your account.
Good credit isn’t necessarily permanent; neither is bad credit. You can rebuild your credit from the worst position possible and restore your financial status without your past getting in the way. Make sure to include the above tips in your credit improvement strategy.