If your credit report is damaged, there are only a few factors that need to be addressed. The most obvious is your payment history. Another issue could be that you’re using too much of your available credit, or “maxing out” your credit cards.
Addressing the issues outlined in this article is one of the best ways to repair your credit report. It’s difficult and sometimes impossible to remove negative information that lowers your FICO credit score, so you need to start showing positive activity to make it go up again.
Your payment history accounts for 35% of your total FICO score. When you’re more than sixty days behind, the credit bureaus will get a delinquency report. If you’re just a few days in arrears on your last payment, try to make it up quickly to avoid the reporting.
If you’re having difficulty making minimum monthly payments, contact your credit card provider or lender to try to negotiate a settlement. You could also apply for a debt consolidation loan to lower monthly payments and interest rates.
Lower Your Credit Utilization Rate
It’s recommended that you keep your credit utilization at or under 30%. In other words, if you have a credit card with a $1000 limit, don’t use more than $300 of it. Better yet, don’t use it at all. Paying cash will keep you out of trouble with creditors.
If you’re already close to your $100 threshold, try to pay it down as quickly as possible by making more than the minimum monthly payment each month. This will bring your utilization rate down and should bring your FICO credit score up.
Pay Off a Few Credit Cards
The credit bureaus and banks also look at how many credit card accounts you’re carrying and the variety of different credit and lending accounts you have. This represents a small percentage of your overall FICO score, but lenders pay close attention to it.
If you have too many credit cards and they’re all close to their maximum balance, that shows the bank that you are a bad credit risk. Before applying for a loan, you’ll need to pay off a few of those cards and get your overall credit usage down.
Ask for Help from Credit Repair Professionals
The steps outlined here seem pretty simple and you could conceivably do them yourself, at least for a short time. Asking for help from credit repair professionals will give you the ability to set up a long-term plan to get out of debt and repair your credit for good.
Credit Helpers has the people and the experience to help you. Reach out to us today to find out how best to repair your credit and live more comfortably within your means. Our team is ready, willing, and able to assist you. Contact us today!