You want to clean up your credit report. But what are the essentials. The first is, as with anything else, to acknowledge that there is a problem. And since you are reading this I think that it is safe to assume that you have completed that step! Having a bad credit report can add a lot of stress to an already stressful situation. There are many ways to clean up that credit report and we will discuss a few.
You need to get a copy of your credit report and verify each and every item on there. You have the right to challenge anything that is on there that is wrong.
The next thing that you need to be aware of is that there are a lot of scams being run in the area of credit reports, debt relief solutions, and helping you clean up your credit report. So the very first thing is that before you do anything with any company, make absolutely sure that you know what you are getting into, how much it will cost you, what could go wrong, and that you are dealing with a reputable company.
The best person to clean up your credit report is you. You can do it yourself. You just have to do a little research to get yourself started. However if you are in dire straights and getting ready to lose everything, you may have to seek out professional help. We will assume that you are not that bad off and that we can help you get started. So with that being said, let’s look at some basic steps to get you started.
The first thing is to make a list of all of the money you owe and to whom you owe it. Also make a list of other expenses that you have each month. The next thing is to look for places to reduce your monthly expenses. Look at ALL expenses. If you stop at the convenience store on your way to work each day, figure how much it costs you per month. If you go out to lunch each day, how much is it really costing you. If these are desperate times, you might have to take drastic measures to get back on track and clean up your credit report.
The next step is to talk with your creditors. You will be surprised at how understanding they can be. You will find that most of them want to work with you. Tell them your situation and see if they can reduce your rate or your payment. They would much rather have you pay your debt off a little slower than to ruin your credit report.
After you have talked with your creditors and have a list of what you have to pay, you need to prioritize the list. Make a list of all the payments that you have to make and the minimum amount. Obviously if you only pay the minimum amount you will never get out of debt. But the first thing is to make sure that you can keep all of the creditors happy. Then you will want to pay off the debts with the highest interest rates first. Or if you have one that is close to being paid off, you may want to tackle it first to give you more money each month. No two situations will be alike so only you can decide the best method for your situation.
Now you may want to look into the possibility of some extra income. Can you do something on the side to earn some extra cash? Is there something that you own and no longer use that you could sell?
Also, a very important point if you are serious about wanting to clean up your credit report. You must stop spending money on things that you do not need. If you have a problem you may want to dispose of your credit cards. Remove the temptation.
Another avenue might be to refinance your home if you own one. But a word of caution: This is a well that you will probably only be able to go to one time. There are a lot of things to consider. Let’s say that you refinance, take cash out and pay your car loan off. You may end up paying for that car for 25 more years, but you know that the car will not last that long. And you must be careful of the rates of interest. If you refinance and get a higher rate you will be paying much more for your home than you would have.
Clean up credit report, some final thoughts. Your credit report is very important. You will want to clean it up and keep it clean. It will take planning, time and discipline. Take the time to make a solid plan and stick it out to the end. The end result will be well worth the effort!