Credit Repair

How to repair bad credit.

If, for some reason, you ruined your credit in the past, and plan to repair it now, what you should is almost exactly the same as what people do in the first place in order to build it.

You should start off by opening a new checking and savings accounts, and you should never ever write a bad check. Nor should you miss payment on any of your bills - utility bills or else. Whatever you are billed for, pay it. And if you have difficulty in paying an account, do not hesitate to close it.

If you cannot get approved for a credit card, do not apply to other credit card companies. It will only make things worse - since your inquiries will be listed in your report, and they will decrease your credit score. What you can do is to apply for a secured card - which means that you will deposit a certain amount to your credit account, and the credit limit on the card will be the same as this deposit.

The above are the things you should do in order to get your credit report back in track. As long as you cease doing the wrong things, and keep doing only the right ones, time is the perfect healer for your credit report. However, you may still want to expedite this process and shorten the necessary period of time required for credit repair. in order to get this done, view your credit reports from three major credit bureaus, make a list of the adverse information on the reports, and apply the below presciptions for the mentioned ills whenever possible:

Late Payments:

If your credit report shows late payments, you can try to work with your lender to take it off of your report. What you need to do is to contact your lender, apologize for the late payment, and convince them that it is a one-time mistake, and that it will not be repeated. If the lender agrees to send you a letter that the report about your late payment was made in error, send a copy of this letter to the credit bureau. (If you know that you have recently made a late payment, you should still contact your lender in order to convince them not to report it to the bureau before they do so.)

If, for some reason, you will not be able to make your monthly payment, you should contact your lender BEFORE the due date, and inform them of the situation, tell them that this is a one-time occurrence, and that you need them not to report to the credit bureaus since you are aware of the importance of maintaning a good credit score.

Collection Accounts

Having collection accounts in your report is one of the worst things that can happen to your credit. But it is not impossible to get rid of them. One thing you need to remember at this point is that the mission of the collection companies is NOT to destroy your credit history. Their mission is to collect money from you, and they will do everything possible to get this done, including negotiating with you - which means that removal of your collection accounts from your report can very well be one your negotiation terms. Do not ever agree to pay the collection company unless they agree to remove their account from the credit bureau. Moreover, ask them to do it BEFORE you pay, and send you a confirmation letter. After you pay, you will have nothing to negoriate.

Other

One thing you can always do about your credit is to place a personal statement in your report. When you send a personal statement to be placed in your report, credit bureaus are required by law to add it. Your statement is limited to 100 words, but this is more than enough to make a clear explanation of your situation. You should be clear and honest when writing your statement. An example may be:

I have a Target account on this credit report which is listed as unpaid. I have never opened a Target account. Not do I know how such an information made it here. I have tried to have it erased from my report, but it still did not happen. I am a responsible consumer - as reflected by other accounts listed here. Please disregard this account when making decisions about my creditworthiness. Thank you.

Another example may be as follows:

In 2005, I was hospitalized for three months, during which I not only unable to make payments to my accounts but also charged high sums by the hospital since my health insurance did not cover all costs. I am a responsible consumer, as reflected by other accounts listed here. I have since recovered physically and financially, and am working full time, and paying back the hospital.

In sum, use the above examples to get an idea of how your personal statement should look like, and just try to make a plain explanation of your situation without going into needless details.