Fixing Bad Credit Is Possible If You Use These 3 Tips

Good credit plays a vital part in getting the money you need to make major purchases, such as buying new or a car. But if you have a bad credit then it is no less than a nightmare as it stops you makes any transaction.

Unfortunately, for many Americans, their past trouble in paying off debt or mistakes by credit reporting agencies can lead to lower credit scores, which ultimately limits your ability to secure credit.

If you are one of the millions of Americans who have negative events on their credit reports, one option to improve your credit score is to work with credit repair services. Or understanding why you were not approved and following these three tips for rebuilding your credit might work: 

Identify Things that are Hurting Your Score

When rebuilding your credit, there are five components that could impact your credit score. They are- payment history, credit utilization ratio, and age of credit accounts, credit accounts mix and your history of applying for credit.

The most important factor is your payment history as it accounts for 35% of your score. If you’ve applied for your credit reports a lot recently this may be negatively affecting your score. While there’s nothing you can do about this, although they will stop hurting your credit score as they grow older.

Fix Your Reports 

When you analyze your credit reports you may find mistakes. According to a report, about 20% of us have errors in at least one of our three credit reports that are affecting our credit scores. If you find mistakes in yours

•  You must dispute each mistake with each credit reporting bureau.
•  You can’t dispute multiple errors on one credit report with just a single letter. However, if one account has multiple errors you can put them into one dispute.
•  You don’t need to do this alone. You can take help from a credit repair services or credit repair expert that specializes in this type of case. 

Start a Good Credit History 

Even though you may have been turned down for one kind of credit this doesn’t mean that you can’t get other types. Opening new credit can help fix your credit quicker if your credit utilization ratio or account mix is hurting your score.

In fact, there are credit cards designed specifically for people who have bad credit but would like to fix it. They are called secured credit cards as they require a deposit. Once you use up that deposit you will need to add more money to your account or stop using the card.