Where Credit is Due – 5 Ways to Deal with a Bad Credit Rating

Boost Credit Score and Prep Docs for Fund My Contract Financing

Dealing with bad credit used to be simple. You just didn’t answer the phone when creditors called. These days, however, bad credit follows you everywhere you go.

Hoping to rent a new apartment? The landlord will most likely check your credit. Looking to insure your home or vehicle? Yep, they will check your credit, too. And of course, anytime you want to buy a new house or car, the lender will most definitely confirm your history.

If you have a bad credit score, there’s no reason to continue suffering the consequences. If you start thinking about the future and follow the suggestions below, you will eventually enjoy a better credit profile than the one you have right now:

1. Get the Financial Help You Need Now

For many people, a bad credit rating isn’t something they choose to have. Instead, it is the byproduct of losing a job, getting sick, or some other life situation over which they have no control. When life’s surprises send you into a downward financial spiral, you can obtain small loans for people with bad credit from reputable lenders to get yourself back on your feet.

Designed with affordable interest rates and easy-to-pay-back terms, these loans help you pay off pressing bills before they become a negative mark on your credit score.

2. Check Your Credit Score

It’s not uncommon for credit scores to contain errors. Businesses and collection agencies often fail to communicate with the credit bureaus when you pay off the debt owed to them.

To make sure your credit score is an accurate reflection of your debt, check it periodically and dispute any errors you find with the credit bureaus themselves.

3. Make Payments on Time

One of the most significant contributing factors to your credit score is whether or not you make loan and credit card payments on time. Set payment reminders on your cell phone or use the lender’s online reminder service to help you remember to make payments when they are due. Check with your bank as well, as they usually have an electronic payment service that automatically pays the bills you set up in your account.

4. Work with Your Creditors

If you struggle paycheck to paycheck to make ends meet, contact your creditors to work out some sort of payment plan. Letting them know where you stand can help you make your payments on time and keep it that way.

If you are unable to work things out with your creditors, the next best thing to do is seek the help of a reputable credit counseling service. While this won’t increase your credit score right away, your rating will improve over time, and the agency can stop all collection efforts and past-due charges while you catch up.

5. Manage Credit Cards Wisely

Most people think they must stop using credit cards (otherwise known as “revolving credit”) altogether and close them out to increase their credit rating. This is not necessarily the case.

  • Keep low balances on your credit cards. High balances have a detrimental effect on your credit score.
  • Pay off your credit card debt – don’t just move it from one card to another.
  • Don’t close out any credit cards you don’t use. Keep those lines of credit open and active with low balances you pay off right away.
  • Don’t open any new credit cards.

Anyone can end up with a bad credit score. It’s how you bounce back from it that matters. Whether the loss of a job or some other circumstance lands you in credit hell, you can use the ways to deal with a poor credit rating above to find your way out.