Your credit report is what financial institutions use to get a window into your past and your present financial situations. If you are currently suffering through bad credit rating due to a job loss or any other unfortunate situations, there are ways you can re-establish your credit worthiness and start over.
Before you can start fixing your credit score, the first step is to get a copy of your credit report. Once you receive your report, make sure that you examine it from top to bottom for possible errors. Checking your report may reveal some accounts that have been paid off already, identity fraud, or even double listing of the same accounts. When dealing with erroneous charges on you report, it is more effective if you seek the advice of a credit attorney.
The second step to raising your credit score is adding some positive accounts to your report. Even if all your negative items are removed or expire from your credit report, you still need to have some positive accounts to produce a rating.
One way of getting positive credit is by applying for a secured Visa or Mastercard. There are many companies that are willing to open credit card accounts with a security deposit. A Secured card is backed by your deposit which will then become your spending limit. In some cases, the secured card company may even start you off with a limit that is $100 dollars higher than your deposit. Make sure you find a company that reports your on time payments to all 3 credit reporting agencies.
The third step to increasing your credit rating is having a spouse or close family member with a positive credit rating add you on as a co-borrower. This technique although very effective is a little risky because if your sponsor stops paying their account on time, it will also affect your credit rating. There have also been rumors that the credit bureaus may stop reporting co-borrowers but for now it is still effective.
The last step is discipline. Making timely payments consistently is very important to improving your score with the bureaus. The most important thing that creditors look at when considering credit is your current payment history. The current status of your payments reflects huge in the eyes of creditors.
The credit bureaus will also continuously raise your credit score a few points for every month of timely payments. If you can afford to continuously make 2 years of on time payments, you will have succeeded in improving your worthiness with the financial institutions.
As you can see the formula to getting back on you feet and regaining your credit worthiness is as easy as getting a copy of your report, disputing negative items, adding new positive credit, and making on time payments. Once you have re-established yourself, you should also consider getting identity protection to prevent others from destroying your creditability.
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For additional info on how to order free credit report you can visit how to improve your credit score .
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