It is essential to have good credit now and in the future. Whether one is shopping for a home or buying a used car, banks and other financial institutions will check their credit report and score to determine whether one is creditworthy. Poor credit history can negatively impact their ability to get approved for a loan, purchase a car, and even get a job. Here is what Helen Lee Schifter recommends one can do to start repairing their credit now and in the future.
The main item one needs to do is pull their credit. Get a copy of their report from all three of the major credit reporting agencies. If there is harmful activity on their account, report it immediately. The more one pays their bills on time, and the less debt one has, the better their credit will look.
The following thing one needs to do is pay off any credit cards that one has. If one has a high balance, one should be paying at least the minimum amount on every card every month. If one has a lower balance, one should still pay the minimum amount but make a little more each month. This will help to raise their credit score over time.
When one has paid off their credit cards, one should close the account. Not only will this prevent people from accessing their accounts to monitor their payment habits, but it will also keep creditors from reporting late payments or other actions that could negatively impact their credit score. By paying their expenses on time each month, one will notice a difference in their credit score.
Helen Lee Schifter encourages people to start saving money for emergencies. Every week, save enough money to pay their bills for the entire month. It does not matter how much one saves; it is crucial to put the extra money into a savings account not to be spent immediately. One should also pay down their debts as much as possible.
Make sure that one pays off any outstanding loans before they become due. If one is like most people, one has a mortgage, car loan, or student loan that one is paying on. Once they become due, one may not be able to make the payment. One can avoid this problem by paying these bills off as soon as they become due.
When one pays off their bills, one will have more money each month to put toward their monthly expenses. This will reduce their stress level and allow one more time to pay their bills. The more money one has each month, the less stress one will feel. This is especially important. If one has plenty of money each month, one will not need to stress paying their bills.
It is vital to keep up with their bills each month. Even if one cannot pay them all simultaneously, one should make a payment plan to pay off one bill at a time. If one waits until the bill comes in the mail, one may miss it or pay for something that someone else already paid. If one pays all their bills on time, one will pay off their debt sooner. This will also increase their credit score.
Many homeowners go into foreclosure when they can no longer pay their mortgage. They may have missed payments and fell behind, but there are methods to avoid foreclosure. One can prevent a foreclosure from happening to one by using their credit cards responsibly. If one pays their bills on time and does not fall behind, one will have excellent credit, and lenders will look at a low-risk consumer.
When one is facing foreclosure, one is faced with many tough decisions. If one does not pay their bills on time, they will go into collections and have a more challenging time selling their home. If one gets into a foreclosure, one will have to pay the delinquent amount and a percentage of their loan. When one works with a good professional, it will be easier to pay their delinquent balance and get their loan paid off.