How to Go from Bad Credit to Good Credit Quickly

How to Go from Bad Credit to Good Credit Quickly

Majority of Americans today are living with bad credit, thanks to the economic downturn of 2008. Many of these Americans haven’t bounced back from their financial hardships that emerged because of the slowed economy. A lot of people lost their jobs and some even lost their pensions. Living on a lower income is difficult, especially when you have a substantial amount of debt to pay off. Those who had credit cards and loans and were unable to pay them now have a credit history filled with unpaid debts. This carries great weight on your credit report and will drag your credit rating through the mud. If you’re looking to get your life back on track, then you can use the following tips to help raise your credit score.

Contact a Debt Consolidator

You don’t want to reach out to just any debt consolidation company. Make sure the entity has been around for many years and has a good reputation among consumers. A quick Google search of the company’s name can reveal a lot about them. What’s great about debt consolidation firms is that they can help you set up payment arrangements with the businesses you owe money to. You may be able to combine all of your debts into one monthly payment, so all of your debts are slowly, but surely paid off.

Try to Get a Loan

If you are in good standing with your current banking institution and you’ve been a great customer, they may be willing to give you a small loan. You can use this to help pay off your debts, then you’ll have one loan payment to pay off. Once you start paying off your debts, your credit score will begin to creep back up. Just be wary of interest rates – you don’t want to get locked into a loan that will be more costly than you can afford.

Dispute Discrepancies in Your Credit Report

If you notice amounts or accounts that are inaccurate in your credit report, then you should dispute them. You can do this on the website of the credit reporting agency that is showing the account (Experian, Transunion, Equifax). If the creditor can’t prove the amount or the account belongs to you, then it is removed from your credit report. This will help to boost your credit score quickly, since the creditor has a limited amount of days to respond to the dispute.

Get a Secured Credit Card

If you don’t have debts, but still have a low credit rating, you can move your score up by getting a secured credit card. This is easy to get, since the money on the card is your own. You are borrow against your own balance and replacing that as if it doesn’t belong to you. You continue to use the card each month, paying back the full amount every cycle. This will increase your credit score and your credibility with the financial institution. You will eventually get an invitation for an unsecured credit card using the funds supplied by the bank.

Once you’re debt-free and have more money in the bank, you can start affording vacations. You can book your rooms at Hotels.com and find great deals on rental cars and airline tickets from Groupon.