How to Repair a Bad Credit Score
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How to Repair a Bad Credit Score

Today, living without credit in the U.S. is almost impossible. However, while getting credit can help you build good credit, you need to be smart and avoid racking up outstanding debt and a bad credit score.

Bad credit only makes life more difficult and expensive. If you are looking to buy insurance or a car, bad credit will cost you a higher insurance and credit ratings. Before making any investment, lenders of all sorts will always check your personal credit score before approving a loan or a credit card. The good news is that if you have poor credit, you can improve it with the following repair tips. Keep in mind, repairing bad credit can be a time-consuming task that will take effort on your end:

1. Request a credit report
The first step is to go through your personal credit report, and ensure that there are no mistakes or inaccuracies. Your credit score is based on your personal credit history, including savings, investments, assets, credit cards, repayments, pending payments, student loans, and etc.

2. Analyze improvements
If your credit score appears to be low. For instance, credit scores are given in rage from 300 to 850 points. An very good credit score ranges from 700 to 850, a decent credit score is 680 to 699, an average credit score is 620 to 679, and a low credit score ranges from 580 to 619. If yours is low, look for late bill payments, defaulted loan payments and work to gradually pay them off as fast as you can.

3. Pay debts on time
Now that you’ve paid off old debts, you need to go forward with credit by making all your payments on time. To do so create calendar alerts ahead of time to meet your payment deadlines. If you still have outstanding debts, contact the lender and request forgiveness for the late payment.

4. History counts
You can piggyback on a family, or friend’s credit card, if they have a good credit score. Improving your credit history will easily take on average, 5 years or more. A person with a long credit history will have a higher credit score.

5. Don’t fall into old patterns
Bankruptcy or foreclosure will negatively affect your credit score more than anything. However, if you keep maintaining good credit for the next 5-years, the damage can be undone.

6. Build good credit
If you have never owned a credit card, you need to get one now. Using, and making payments on time with a credit card will help you gain a good, or even excellent, credit score. If you are unsure of taking on a personal credit card, apply for a secure credit card, which lets you deposit money into a checking account, and use those funds as a line of available credit. This way there is a very low chance of missing payments.

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