20 Tips to get your credit in check in 2016

credit score

Having a credit card is a big responsibility, you might struggle paying them off and juggle between several cards on hand. Interest in credit cards can also be a burden. Whether your goal is to buy a new home, become debt free and raise your credit score, or make your payments more manageable, you can make this year to get everything in order. Here are some tips in handling your credit to help you make it possible.

lender

Talk to a lender – Planning to buy a new home soon? You can call a lender to get an explanation as to what you’ll need to do in order to qualify with best rates.

Check your credit – Go to AnnualCreditReport.com to pull out your free credit report once a year.

Credit report with score

 

Dispute anything that’s incorrect – Removing incorrect record from your credit report create a big impact. Time and effort is the main concern here. Better move now than be sorry.

Don’t waste your time trying to get collection accounts off your credit report – Paying off a collection account doesn’t mean it’s going to vanish from your credit report. “It will stay on your report for seven years,” says myFICO.

Set little goals – More likely you’ll have a distressing feeling paying off a large balance in full. Try setting some weekly or monthly goals to pay down your credit to make it more manageable, it will keep you on track of your budget as well.

pay online

Pay off the smallest accounts first – It is our first instinct to pay off the large balances first and shoving off the small ones. But did you know that paying off the small balances first could lower your monthly output and this could allow you to forward those funds to other balances once they’re paid and done.

Or, pay off the account with the highest rate first – This is the one that’s getting the most of you every month. Paying this off will help you a lot.

Contact your creditors – Asking if they have any promotional programs that may help you clean off your debt.

Negotiate your rates – A simple call to your creditors may grant a lower rate.

Transfer balances – You want an easier way to pay off your balances? You can take advantage of sending your balances to another existing card with low or no interest.

Don’t have a card with a low rate? Open a balance–transfer credit card – According to Bankrate, “This allows you to move expensive debt over to a new card, with a low – often 0% – APR for a set time period.”

Get a secured card –Reestablishing credit after bankruptcy is really a tough job, as well as after paying off old delinquent accounts. A secured card from a bank can help you reshape it back up.

Even if you can’t wipe out all your debt now, pay down your balances – According to Bankrate, one of the major factors in your credit score is how much turn around credit you have versus how much you’re actually using. The smaller that percentage is, the better it is for your credit rating. 30% or lower is the optimum.

past due bill

Paying your bills on time – This is the easiest and most effective way to keep your score in good shape. You can also try to improve it.

If you’re buying a home, don’t apply for any more credit cards without your lender’s approval – Maybe applying for a new card can help you out, but it can also knock out your credit score.

reminder

Set up payment reminders – Most of us tend to overlook or forget to pay out the monthly dues, so make sure to set up a reminder from the creditor or maybe set a notification in your phone calendar if it could help you accomplish the task.

Set your accounts on auto pay – This is the most effective set up to automatically pay up your credit. This will automatically draw from your account. Just make sure you have enough money to support this type of payment scheme so that it could cover the payments or you’ll have to pay an insufficient fund bank fee.

pay with cash

Use cash for everything – This is the best tactic to keep track on what we’re actually spending. No surprises and no headaches. The one you earn is the one you spend.

debt consolidation

Think about debt consolidation – Debt consolidation is a form of debt refinancing that entails taking out one loan to pay off many others. The process can secure a lower overall interest rate to the entire debt load and provide the convenience of servicing only one loan. This is the “quick fix” solution as it may eventually cause more problems in the future. Read up more about this before settling for one.

bankruptcy

File for bankruptcy, but only if you have no other option – As this may help to wipe the account clean, this will also create a devastating impact on your credit score. This should be the last resort or the very desperate solution to all of it. The situations you can file are as follows:

  • You’re being sued by debt collectors
  • Your wages are being garnished
  • You can’t pay your bills (due to a job layoff or an unexpected illness)
  • You’re in danger of losing your home

 

Source: realtytimes.com, bankrate.com, myfico.com, Wikipedia, annualcreditreport.com, triphackr.com, serious-loans.com, huffingtonpost.com, pcwd.org, genesiscreditconsultants.com, askprimerica.com, myfight.com, fbi.gov, maxfinance.com.au
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