Having bad credit is one of the worst feelings a person can have. It affects your ability to buy the things that you really want, and now it also affects the interest rates on you major purchases like a house or a car. For some reason it also affects your insurance rates.
There are steps you can take to improve your credit score.
But before you do anything, you must retrieve a copy of your credit report. There are three credit-reporting agencies that will give you a copy for free. You should request a copy from all three because there might be some slight differences between them. You don’t have to worry you won’t be triggering any alarms by getting your credit report three times.
Typically companies that grant credit pull your report from one of the three agencies, but not all three. Make sure you also receive your credit score with each report. The three companies that you will need to contact are: Experian, Transunion and Equifax. There are a number of different ways you can obtain your credit report, but one way is by going to http://www.credit.com.
The first thing that you should do after you have received your credit reports is to study them and look specifically for errors. You may find an old credit card transaction from 10 years ago that you know was paid off. You usually find that the three credit reports don’t match exactly the first time that you do this. When you find an error contact the agency that is reporting the mistake and get them to correct it. Usually they will tell you their particular way of doing this. Sometimes it is a form to fill out and sometimes you can do it over the phone. This is a must if you want to increase your credit score.
If you don’t have any errors on your credit report than you should file them away for proof at a later time. You should become familiar with the credit report and how each one looks. They each are similar but are laid out in a different style. If you study it thoroughly you will see that each one will make more sense.
One trick to improve your credit score is to look at the list of inquiries that companies make that send you offers for credit cards and loans. You should look at the end of your credit reports. There should be a list of credit card agencies, loan companies and mortgage companies that you will notice you have been receiving junk mail from. The trick is to opt-out of these credit offers by removing yourself from their lists. This may take some time but it does slightly affect your credit score. A slightly better credit score can mean dollars down the road not wasted on interest rates.
A surprising thing that you can do is call your creditors that you have a balance with and try to negotiate a lower interest rate or try to work out a plan to pay off the balance more quickly. Talking to your creditors is a great way to save yourself money and to improve your credit score. Many creditors will be cooperative if you only ask, but most people never ask so they lose out on this money saving secret.
After you have done the steps noted above you should recheck your credit score. It usually takes between 30 to 60 days before changes will take place so don’t expect the changes too quickly. A good rule of thumb is to check your credit rating every 90 days. That way you are always sure that they are accurate and that no one is using your credit without your knowledge.