What’s the absolute best way to start cleaning up your credit if it is really bad?
Mar 25, 2009 in
Credit
caromelheart
I know a lot of people have bad credit. If you are financially strapped but want to start working on building up your credit, what is the bst way to go about this? Could you point me to websites or areas online that I can read about this? Thank you!
I know a lot of people have bad credit. If you are financially strapped but want to start working on building up your credit, what is the bst way to go about this? Could you point me to websites or areas online that I can read about this? Thank you!
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4 comments
KeWr on March 26, 2009 at 11:07 am
There are so many sites…
First, see what is IN your credit
Remember, all credit reports fall off after 7 years.
Pay off what you can…any of the smaller ones…anything you can get rid of ups your rating. If you don’t damage your credit further, in 7 years, if you do *nothing*, you will have a clean slate.
With your report, you can see what else you can clean up.
There are services that will negotiate consolidating and allowing you to pay off the higher amounts you have to deal with, usually with a substantial percentage reduction.
If you have a 10K bad debt, they may, or instance, be able to negotiate a pay off of around 5-6K.
I’m not sure of *who* is the best, and most reputable, service to use…I’ll let others fill in that hole.
virgil on March 28, 2009 at 10:06 am
stop spending so much
get a better paid job
Bumblebee on March 29, 2009 at 8:46 pm
1. Pay down or eliminate the debts starting with the newest.
2. Reduce the number of credit card accounts to 3 or 4.
3. Make sure your credit report is accurate.
4. Reduce the debt on credit cards to below at most 40% of each card’s credit limit.
5. Make sure you pay bills on time (even though any late payments will remain you should get a better score for paying on time.
Good luck!
rocksister on April 1, 2009 at 10:05 am
Cut up the credit cards. Pay off the least debt first, paying as much as you can spare each month. Then pay the next smallest one, etc. until you get them paid off. It will take time; nothing like this can happen overnight. Also, try to consolidate all the cards into one card by moving the balances, find the lowest rate you can, and do NOT buy anything on credit EVER again. Keep an emergency, low-rate card, but don’t carry it in your wallet. Keep it in your vehicle, well hidden, but do NOT carry it. This will keep you from being tempted. Get a debit card; if you see something you want, and you don’t have the money in your account to use the debit card, save up for it. I put a few dollars each payday into a lockbox. I’ve been doing this for a few months and already have over $200. I will use this to buy tires or brakes for my truck when it needs them. And I will do it with CASH, not credit. Make a list of what you absolutely have GOT to have and what you can live without. I have basic cable ($23 a month), basic cell phone ($40 a month), no land line phone, vehicle with NO extras (except air; it’s over 100 degrees in summer here), and everything I have is no-frills. You’d be surprised what you can live without in order to get to a debt-free life. And once you get there, nothing feels better than that!!! Check out Dave Ramsey’s Christian financial web site. Sorry not sure about the name. Money Matters???