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    There are many reasons that an individual may have a poor credit score, such as a recent divorce, bankruptcy or overwhelming bills. Regardless of the cause, a proactive approach to improving a credit score will have the most effect. Even with a credit history that is well below the average, it is possible to achieve a higher score and additional financial opportunities through practical financial planning and diligence.

    To start improving their credit, the first step for a consumer is to find out what items are on their credit report. A free credit report from each credit reporting bureau (Equifax, TransUnion and Experian) is available once each year from the government. It is vital to get all three credit reports, as some accounts may appear with only one or two of the agencies due to creditor reporting inconsistencies. Each item listed on the credit reports should be carefully reviewed for accuracy, including the length of the account and the current balance. Any incorrect items can be disputed directly with the credit bureau that lists them.

    Obtaining and reviewing all three credit reports provides a full financial picture, as well as clues to improving credit. For individuals with numerous open credit cards carrying balances, a balance transfer to a low APR credit card can be beneficial. This way, the amount would accrue less interest, be paid off more quickly and would only require one monthly payment to one company. For those with few open accounts and a limited credit history, getting a secured credit card can improve their amount of available credit, as well as their overall credit score.

    Individuals who have overwhelming debt from numerous different sources may require professional assistance to rebuild their credit. In this type of situation, a credit counselor can often help to reduce late fees, fines and interest rates by negotiating directly with the client’s creditors. This process makes the debt more affordable and improves the odds of the client paying off their debt and increasing their credit score.

    No matter how dire the financial situation, any person can improve their credit score. Some credit problems are easier to resolve, such as disputing an incorrect item on a credit report, and some are much more difficult, such as a long history of missed payments. People with a very poor credit history typically need to take steps to increase their score, and may need to contact a debt counselor for help. A positive credit history takes time and effort to build, but is essential in order to receive the best financial rates and offers.

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