Improving Your Credit Rating

Credit is an integral part of the modern economy and nearly every member of the UK population has used credit at some point in their life. Even if this doesn’t involve directly borrowing money, any service that you use and then pay for later (like a gas bill, for example) will appear on your credit rating.

So, it’s clear that credit ratings are very important, particularly if you want to borrow big sums of money, but how can you improve your credit rating if you haven’t had the best borrowing history?

First of all, make sure that you use one of the online credit check tools (click the link to check credit rating) from one of the big credit agencies like CreditExpert, this will allow you to carefully study your credit history and clear up any problems that you come to light.

The first thing to worry about is general maintenance, so if there are credit lines that are still listed as open but are no longer used, close them down. If there are others that point to the wrong address, or have a slightly incorrect name on them, make sure that they’re right. The aim is to have all your personal details 100% accurate so that when you come to make an application there is no confusion.

After that a good next step towards improving your rating is to sign up for the electoral roll. It’s surprising how much of a difference this can make, but being signed up at the correct address will improve your credit rating.

Then, make sure that any issues/negative marks on your rating are dealt with. Sometimes you won’t be able to get rid of them altogether, but you can talk to the companies concerned if you have negative ratings and try to get them improved. Failing that you can always talk to an organisation like the Citizens’ Advice Bureau to help you improve your credit situation.

If you can’t get the issues dealt with straight away, the best thing to do is concentrate your resources to pay off troublesome debt. The idea here is to get rid of any credit lines that have been problematic completely. This could take a little while, but if you’ve got a bad credit rating it’s better to deal with the issues straight away. It’s certainly a good idea to clear up any problems before you make further applications that may well end up being rejected and thus have a further negative impact on your rating.

The final thing to remember is that a credit rating isn’t the only factor taken into consideration when you make an application and if you have had past credit problems you should always start off by talking to your bank.

Shop for better rates on bad credit loans

A person having bad credit scores often finds it very difficult to qualify for the lowest interest rates with different financial institutions and reputed banks. His loan application will be rejected right away. But now, this picture has changed completely. Now, there are different banks and other financial institutions that are willing to offer loans to people with bad credit. These loans are specifically designed for such people because of the growing number.

A lot of people with good credit scores have to face bad credit at some point of life because of the sudden changes in their lives. There are certain unavoidable situations that force someone to default in his payments and the creditors leave no chance to report their accounts as late to the credit bureaus. Serious situations like death, a divorce or students having excessive spending habits before they realize the important of good credit are some of the common situations where a person is forced to have a bad credit. Sometimes, it can be also due to prolonged illness and personal problems. As long as the person is concerned towards improving his credit scores, lenders will consider granting him new credit. Chances are that the interest rates will be higher in comparison to the normal loans, but still you will be able to shop for better interest rates with a bit of negotiations and searching around for the best loans.

Search for the best rates on the bad credit loans

When you are having a bad credit and are looking for a low interest loan, then it is quite obvious that the best deals won’t come to you automatically. You will have to shop with different companies, compare the quotes with different banks and see the best deal in your case. Nowadays, you don’t have to run from one lender to another lender and compare the interest rates. The convenience of the internet has made difficult things possible and you can compare different quotes with different lenders by sitting in your living room. You just have to log in to the internet and the best deals are just a click away.

Improve your credit ratings by a credit repair service

There may be many reasons of having a damaged credit. If you are thinking of filing for bankruptcy just because of tarnished credit, you now have some better options and improve your credit ratings. There are many online credit repair services that will help you in regaining control of your finances while improving your credit scores.

A reputed credit repair service company can clean up your credit file. While there are certain items that can be completely taken off from your credit report, but they can at least work on those negative items that can be taken care of and make your credit report look better in front of the potential lenders. These credit repair companies may charge you a modest fee which will be worth paying. Otherwise, with a bad credit, the potential lenders will not be willing to offer credit in the first place, and even if they do so, they will be charging very high interest rates when you take out a loan or a credit card.

Removing inaccurate negative items from your credit file: The credit repair company will pull your latest credit report and see the inaccurate negative items on your file. Although you can also find out the inaccurate negative items on your file and dispute it with the credit reporting agencies and the credit grantors, but the process of removing the negative items can take too much time which can often get frustrating at times. These credit repair services are charging you a fee for their service but they will assure you results at the earliest possible time. You just have to sit back and relax and see your credit ratings getting fixed at the earliest possible time.

Get rid of collections: The credit repair service will also work with accounts that are gone to collections. They will contact the collection agency and negotiate with them to reduce the outstanding balance as per your present financial condition.

Consolidate loans and credit cards: There are many credit repair services that offer consolidation loans. With this consolidation loan, you will be able to pay back some of your debts like a car loan or a home loan if you are expecting to default in their monthly payments. You may later pay the credit repair service for the consolidation loan at an affordable interest rate.

Avoid bankruptcy: Many people utilize the services of a credit repair company to avoid bankruptcy. Bankruptcy carries a stigma that is hard to get over and it can stay on your credit report for seven years. Most of the financial institutions will not be willing to offer any new credit just after you have filed for bankruptcy. Even if any company offers any credit, they will be charging very high interest rates on the credit. By utilizing the services of a credit repair company, you not only rebuild your credit, but you can also avoid filing for bankruptcy. This will help you in putting your life back in track and save a lot of money from being charged high interest rates and financial fees.

Enroll in a debt management program and keep your credit good

The best thing that you can do for your credit is to make timely and full payments to your creditors. Whenever you carry forward any balance to the next billing cycle with your creditor, you will be charged an interest rate and the financial fees on the remaining balance. It is always suggested that you should be making larger payments on the total balance so that you spend less on interests and fees. If you are making just the minimum payments, the credit card companies are chargi

ng their highest interests and fees on every billing cycle. There are many of us who find it hard to make ends meet and are living on paycheck to paycheck.

If you are on the verge of not being able to make the minimum payments, it is time to get some serious help. In order to keep your credit in good standing, you should never get late in your monthly payments. But that means that you will have to make at least the minimum payments. And the minimum payments will also continue to get higher on every billing cycle. The credit card companies are making the maximum money from people in such financial crunch and penalize them heavily.

There is a way to fix this financial problem and not hurt your somewhat good credit. You need to enroll in a debt management program and combine all your bills under one monthly payment. Instead of paying to a number of creditors on a different due dates, you will have one monthly payment in the debt consolidation/debt management program. The debt management company will negotiate with your creditors to reduce the current APR. When you are paying directly to your creditors, most of the money is eaten just in interests and fees. In the debt consolidation program, you can afford to pay the same amount and see the maximum portion going towards the principal balance and less in interests. The debt management company will be negotiating with your creditors to reduce the current APR and waive off most of the financial fees. You will have a reduced balance to pay in the debt management program to all your creditors. If you have decide to enroll in the debt consolidation program, be sure that you will stick to the same repayment plan and if possible, pay any extra amount towards the principal balance on a certain month, thereby bringing down the total balance. The repayment plan in the debt consolidation program will be much lower that what you have been already paying to your creditors. However, you can always increase it according to what you can afford in the program. If you want to lower the payment plan in the debt consolidation program, the creditors will charge you their interests and fees again. Whatever may happen, do not default in your monthly payments in the debt consolidation program until you have completed it.