When you are deeply in debt it can appear there is no end in sight. Your credit is shattered. To fix your credit can take a bit of time, but it is worth it for many reasons: easier to qualify for a needed loan, lower interest rates, and less stress. An excellent score is considered above 750.
Get a copy of your credit report
Each year you are allowed one free credit report. If you go on Annual Credit Report, it will give you a copy of your credit from all three agencies: TransUnion, Experian and Equifax. This will list all your debt that you owe. It will give you a snapshot of what true challenge is ahead. Take a close look at the report to make sure there are not any debts listed on the report that don’t belong to you. This is your first step to help improve your credit.
Pay off debt
Take a look at each credit card and start paying them off one by one. Start with your highest interest credit card first. Put any extra money towards that card until it is paid off. Once you have accomplished this, take the extra money and put it towards the next card. One by one the cards will soon be paid off and not be a burden.
It is important not to close the credit cards once they are paid off. Many find this as a surprise, but it will lower your credit score. Your debt to credit ratio is an immense piece of your score.
Saving is a crucial part of improving your score. Even you can only put away a few dollars a week, it is a start. Slowly but surely you will see your savings increase. This will make a significant effect on helping your credit score rise.
Pay your bills on time
Having late payments show up on your credit report is not good. Be sure to pay each bill in a timely manner. This can be very easy these days by setting up an automatic payment to each account you owe money to. It will also help you save money from late payments.
If it is too much
There are credit card counseling services that are available to you if you are in dire need. Do you research that the company that is helping is legitimate. They will help consolidate your credit, and many times get rid of interest rates on your credit cards to help pay them off quicker.
Following these steps will help fix your credit score. It will take time and patience. This will not take place overnight. Be diligent and it will happen. For more information: How to fix your credit