5 simple ways to start rebuilding your credit rating yourself
Create and stick to a budget of your regular and every-so-often monthly expenses. Determine how much you will net each month, and plan how to spend it to reach your credit restoration goals. Some expenses that you can avoid should be deleted, or at least suspended, while you are in this credit recovery mode.
Pay all bills on time. Better yet: pay them early. Don't wait until the last minute to pay. It's a good idea to pay at least 3 days early, then check the firm's website to ensure your payment has been applied on time. Always keep copies of checks and online payments to dispute late payments.
Pay a little more on each credit card and installment loan you have. This will help you pay down your debts faster. At least pay what you've charged that month, plus a debt reduction amout (say, 5% of the total credit card balance due), and pay off all interest charged to your credit card that month.
Get a new credit card that has a low interest rate, if you qualify. Use it only to rebuild your credit score by making small charges every month, then paying off the total amount in full each month to demonstrate good credit habits. You may also need to use a secured credit card which is connected to your savings account. The value of this is that you will be able to start building a good credit history even if your credit is so bad that you cannot qualify for a regular, unsecured credit card account any longer.
If you are carrying a large balance on credit cards, consider selling a second car, property, jewelry, collectibles, items stacked away in the attic, to raise cash to pay-off your credit card debts in a big way. Once you've gotten that credit card balance paid down, don't resort to using it again and run up the balance. Stay in control of your spending.
By following these five simple tips, you can restore good credit and enjoy peach of mind when it comes to your monthly bills.
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