A Credit Restoration Guide

A very important step in financial planning and securing a future for your finances is to restore your credit and to improve your credit, even if it is decent or if your credit is pretty bad.  Taking the proper steps in credit restoration will enable you to finance more in the future, and at better interest rates with less fees.  it will also help you when it comes to buying a car, buying a house, or getting other types of loan.

The first thing that you will want to do when embarking on restoring your credit is to check your credit report.  The services that you hear about on TV and radio ads that allow you to look at your credit reports are usually tied to a monthly subscription service that you have to sign up for.  If you haven't checked your credit report, every US citizen is allowed to check their credit reports from all 3 credit agencies for free once a year!  Just search on Google for "free annual credit report" and you'll find it.

When looking at your credit report, you will want to make sure that there are no errors on there.  If it is showing a missed payment and you have proof that you made a payment, then you need to contact that credit issuer and have them fix the correction.  Mistakes happen but those types of things can hurt your credit score.

You will also want to make sure that there is no duplicate accounts.  If you did miss a payment but the account is duplicated in the report, then it will be affecting you twice as much.

If there is anything negative in your account from over 7 years ago, then you should call that credit agency and have it removed since it shouldn't be in there after 7 years.

If there are any finance accounts missing, especially ones that you have paid on time every time, then call that company and ask them to please put it in your credit report.  That will help to boost you up.

The next thing you want to do to being to restore your credit is to use your existing credit wisely.  You definitely need to make sure that you pay all of your bills on time.  If that means getting a second job or whatever, then do that, because if you continue to miss payments, then it will just either hurt your credit or delay the improvement of your credit.

The next thing you want to do is to not close any credit card accounts.  Shred the card if you have to, just don't close the account, because the longer you have accounts open in your credit history, the better your credit will be.

Another tip is to pay down your balance as much as you can.  if you are able to go below only using 50% of your total available credit, that will give you a nice boost in your credit score.  So, if you have $10,000 available on all of your credit cards, then make sure you have less than $5,000 in balances across the cards.  That will help to boost your score too.

If you do have any cards with a $0 balance, then continue to use them once a month, and pay off the balance quickly, because that will keep the credit active while not hurting your overall balance.