In order to repair your credit report you need to work on eliminating negative information contained in it, and get caught up on your past due accounts. This will raise your score initially but will take time and effort to be considered credit worthy to potential lenders again.
The trick is learning good credit habits that will help you develop spending and payment patterns that enhance your financial standing rather than detract from it.
Using credit cards wisely can be a difficult skill to master, but necessary if you do have, need, or want to have credit extended to you.
Using credit cards for everyday purchases such as food, gas, clothes etc. is about the worst thing you could get into the habit of doing. If you can’t use cash or debit, don’t buy. Things cost so much more on credit you could never get ahead that way.
Making only minimum payments is another bad habit one should avoid falling into. Your debt will never be paid off if you only pay the minimum required each month. Ever. So always pay more than the minimum.
Another habit to break or avoid is using credit cards to buy things you simply cannot afford. You need to budget and plan for large purchases. Do not attempt to live above your means.
Be certain you know the difference between what you need and what you want. Focus on real needs, plan and save for what you want and be responsible with credit to develop good spending habits. Overpay whenever possible and always be on time with payments.
Be good with creditors, notifying them in advance when you can’t pay for it or are going to be late. Often they will work with those who are honest and upfront and show that they want to pay what they owe.
Finally, never exceed your credit limit. If you limit purchases to no more than 30% of the available line of credit you’ll never find yourself in over your head.
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