Bad Credit Tips
Read these 10 Bad Credit Tips tips to make your life smarter, better, faster and wiser. Each tip is approved by our Editors and created by expert writers so great we call them Gurus. LifeTips is the place to go when you need to know about Debt Consolidation tips and hundreds of other topics.
How can I remove errors from a bad credit report?
Many people who had bad credit learn that the poor scoring was never their fault in the first place. Errors are found all the time on credit reports and these can come from any number of reasons.
- Sometimes you may have a social security number that is only a digit away from someone with terrible credit practices.
- Other times, derogatory notes are simply reported in error on your accounts.
Either way, you can easily remove errors from a bad credit report with a few short steps.
- First, identify the precise errors. The best way to do this is by getting your hands on a free credit report. After you have gotten the errors itemized, take the time to create a document that explains each one. Bad credit is easiest to fix when you go overboard with your information.
- Once you have the itemized document, contact each of the credit bureaus that are carrying the erroneous items. Chances are that they will want verification of the errors and why they should be removed, but if you have prepared yourself you will find this information easy to provide. That is just about it.
If the credit bureaus still refuse to remove the errors from your credit report, contact a bad credit specialist. There are many available that can cut through the red tape of credit reporting and get action taken on your account much faster. There are often fees for these services, but when you compare the fees to the poor rates you will get with bad credit, you are saving money for sure.
How can I avoid bad credit in the future?
If you have concerns about your credit, chances are you should. Everyone should pay closer attention to their credit scores because these, unfortunately, can dictate the home you live in, the car you drive, and the stores you shop at.
If you want to avoid having to qualify for only bad credit loan scenarios, here are a few ways to stay on top of your credit scores.
- First, use a credit monitoring service. Today, there are many different companies that can offer you credit monitoring services in order to keep tabs on your credit day to day. If someone is trying to access your credit information, you will see it. If someone reports something bad to your credit bureaus, you will see that too and have time to correct it. The key is in being aware and a credit monitoring service can help you avoid bad credit loans.
- Another way to avoid this situation is to use automatic bill payment options for your monthly bills. By utilizing these offers from different services, you can be sure that you never miss a bill payment because you bills will be paid as soon as they come due. This sure fire payment solution can help you avoid bad credit scores and needing bad credit loans.
There are many other ways to avoid bad credit in your future. Take a look at the resources provided by professionals such as our sponsors and you will find that keeping your credit in the high scores is easier than you think.
Should I refinance my bad credit loan?
If you had bad credit in a previous time and were forced to take on a bad credit loan with a high interest rate, the time is now to rid yourself of it. Assuming you have repaired your credit, you can now refinance your bad credit loan into a lower rate and better terms. Here are a few places to start when it comes to refinancing a bad credit loan.
- Start with the lender that issues you the bad credit loan in the first place. If they were willing to invest in you when you had bad credit, than they will love to work with you now that it is repaired. There are often rewards for such a scenario offered by many bad credit loan specialists. Simply get in touch with your current loan representative to see what they can offer you.
- If your current lender doesn't work out, don't worry. Get online and start getting quotes on a bad credit loan refinance from independent lenders like our sponsors. You will find that with good credit, lenders like ones found online will line up to give you a great rate and super terms. Make sure you have your current loan information prepared for them so that they can provide you with a savings comparison after your refinance.
Refinancing a bad credit loan is easy once you have fixed your credit. Make sure that your credit is back to where it should be by getting a free credit report or using a credit monitoring service from any number of providers. Once you have your credit straightened out, get rid of that bad credit loan rate and start saving.
Are bad credit repair services worthwhile?
You can hardly turn on the television or get on the internet without seeing more and more ads for bad credit repair services. Are there really that many people needing bad credit repair? The answer is yes.
You should be asking yourself if you are one of these people. Most people do not even know their credit situation and only learn how bad it is when they go to apply for that new car loan or mortgage. When the news hits them, they think about all of those commercials and banner ads and kick themselves for not thinking more about it. There would not be so many companies offering bad credit repair services if the demand was not present. These services can really help and if you are in a situation where they can, take advantage today. The longer you let bad credit go, the worse it will get.
You need to take action and bad credit repair services can help. Start with a credit report to see where you stand. If you find that your credit is lower than it should be, then take this report to any number of bad credit repair services to get quotes and comparisons as to how they can help. Most will be able to provide you with a thorough analysis that can show you your credit now, how it got that way, and the fastest way to get out. Check out our sponsors for specific scenarios regarding your bad credit and they may be able to help you move on with your life and put the bad credit past behind you.
What are the basic steps to fix bad credit?
- Get a Credit Report – You cannot fix bad credit until you know exactly what is causing the problem. A credit report can show you whether you had late payments on a credit card or mortgage that led to your credit problems. Once you see a credit report, you can fix bad credit with a little research.
- Research – Once you have seen the specific problems on your credit report, you can begin researching to see if they are accurate. Many times, people looking to fix bad credit find that there was no bad credit in the first place. Inaccuracies are found all of the time on credit reports which is why seeing a report for yourself is so important. Through research, you can make sure that the items on your report are not works of fiction, or simply errors based on an incorrect social security number.
- Petition – If you find errors on your credit report, you can petition to have these items removed. In order to fix bad credit that does not involve errors, you will still want to petition as many of the derogatory notes as possible. There are rules for how ling items can stay on a credit report, but typically they will not come off by themselves. If you want to get them removed, you will need to make some noise. You can do this yourself by contacting the individual bureaus or you can enlist the help of a professional who specializes in fixing bad credit.
Should I get help for my bad credit repair?
The secret to bad credit repair is in getting the right help. Few people would even know where to begin when it comes to bad credit repair on their own, but there are professionals out there who can fix your credit and help you keep it that way. These people are financial consultants and there are many that specialize only in bad credit repair.
If you want to get the ball rolling towards fixing your credit, start by setting up a few consultations with financial specialists. You can find them in your local neighborhood or on the Internet. Many people prefer to speak face to face about something as important as bad credit repair, but you can find highly competitive professionals through the Web.
Often, because they have more resources at their disposal, these online specialists will get more done in a shorter period of time. One thing is for certain, you will have a lot of questions to answer when you begin your bad credit repair. First, you will need to explain the bad credit reports. Each derogatory instance of credit on your report should be accounted for so that your specialist can do their best to have it removed. Credit bureaus will not just take these things off without good explanation and followed procedure. A professional familiar with bad credit repair can know these procedures and execute them if you give them all of the information that they need.
Don't spend another day in bad credit limbo. Get your credit straightened out with the assistance of someone who knows all the tricks of the trade. You will find that their assistance will grease the wheels toward bad credit repair.
Can I get a decent rate even with bad credit loans?
For whatever reasons, many people find themselves in trouble with their credit. Whether because of late bills, unpaid hospital fees, or any number of other reasons, maybe your credit score is hurting as well.
If this is the case and you want to do what you can to get back on top of your credit, bad credit loans are available to help. Usually, bad credit loans come with very high interest rates. Because of the bad credit, lenders look at you with a higher risk. They balance this higher risk with higher rates. However, there are bad credit loans out there that do not have ‘bad credit rates'.
The trick is finding these loans and then never missing a single payment. Speak with a professional about a decent rate on bad credit loans. If your credit was only poor because of something that has been settled, the lender will often take a chance on you with a better rate. The mainstay with these loans is that they will be far stricter when it comes to repayment. Often, if you miss a single payment, the rate will either skyrocket or the loan may even be foreclosed on.
If you are lucky enough to get a good rate on a bad credit loan, do not make the mistake of messing it up with a late payment. Start by looking to local lenders and the Internet to find bad credit loans that you can qualify for. Once you find somewhere that you know you can work with, get more in depth as far as requesting a lower rate. If you find the right place, it may be easier than you think to get good rates on bad credit loans.
How can I fix bad credit habits that keep my score low?
Most people who find themselves in bad credit situations are that way because of bad habits. Identifying bad habits is the first step to rectifying your credit report.
- Do your fingers go to the plastic when you are out at dinner or to the paper?
- Are you unable to refuse financing offers that come with signing up for a new credit card?
These are just two bad credit habits that many people fall into.
Here are the ways to break these, specifically.
- It is understandable why many people choose to carry a credit card. They were not invented for everyday expenses and many people still keep them only for emergencies. If you suffer from the first bad credit habit that was mentioned above, ask yourself next time; Is dinner an emergency? Usually it is not and should not warrant the use of a high interest credit card. Even if you pay your balances off, daily interest can be a killer on those small transactions that sneak in. The best solution to this is to cut your cards up. However, as I said, it is understandable why you would keep one around. Just keep it limited to 1 and don't let your fingers pull it out unless it is absolutely necessary.
- When it comes to those special financing offers that come in the mail from every bank and retail store around, do yourself a favor - steer clear. Sure, there are always better rates and offers coming, but many people do not realize that by constantly moving your credit around, you are actually hurting your score. Most mortgages require having a few lines of credit that have been active for over a few years. If you are always getting new cards and canceling old ones, you will fail to meet this need and your credit will suffer overall.
To fix bad credit habits you need to fix the way you look at credit. Acknowledge that the problems exist and start taking steps today. Consult with a professional to see how to stay on the right path once you have fixed your bad credit habits.
Can a bad credit loan actually help repair my credit?
There are many ironies in the world of finance. One of the biggest ones is that the only way to improve bad credit is through bringing on a new creditor. If your credit is poor and you want to work towards bringing it back up, a bad credit loan can actually go further than any other option towards this goal.
Here is how it works. Your credit worthiness is based on everything that appears on your credit report. If you had loans that were not paid on time or credit cards that were cancelled by the bank, the uphill climb to credit repair is steep. However, the best way to go about the climb is to get a bad credit loan and treat it as you should have your previous loans.
Taking on a bad credit loan and making payments on time sends a signal to the credit bureaus that you can maintain your loans and balances. After a period of time of making prompt payments, you will see that the bad credit loan will actually help boost your credit back to where it should be. Assuming you have done this and taking a bad credit loan helped you get your score back up, eliminate the loan as soon as you can.
These types of bad credit loans can be refinanced or consolidated into a mortgage or home equity line that carries a much lower rate. Now that you have better credit, there is no need to carry the high rates associated with your bad credit loan. It may be ironic to take on a new creditor in order to fix bad credit, but it is also a solution.
What are some things to avoid in bad credit loans?
For those that can only qualify for bad credit loans, there are several things you should look out for. Bad credit loans come with all sorts of contingencies and pitfalls that if you fall into are too hard for most to climb out of. Here are a few things to avoid when it comes to bad credit loans.
- Late Payment Increases – Lenders have gotten smarter in recent years. One of the ways that they have increased their potential earnings is by not foreclosing right away when bad credit loans go on with late or missed payments. Instead of foreclosure, many lenders now have steep rate increases that will be instituted in the event you are late or miss a payment. When you are comparing bad credit loans, stay away from these types of penalties if you have any chance of being late or missing payments. The best thing, of course, is to never be late on your loan.
- Prepayment Penalties – If you are having to look only at bad credit loans, chances are you have some debt issues as well. Your goal, therefore, should be to get yourself out of debt as quickly as you can. Prepayment penalties will not help you here. A prepayment penalty means that should you pay your loan balance off early, you could incur charges and fees. Avoid a prepayment penalty on any bad credit loans that you are thinking of taking on.
- Balloon Payments – Many bad credit loans look great on their face because the payments seem very low. This is often the case because the loan comes with a balloon payment at some point down the road. A balloon payment is just as it sounds, a HUGE payment that will include the remaining balance on your principal loan. Few people with bad credit loans can ever afford these payments, so stay clear if you can.