15 Tips for Improving Bad Credit

15 Tips for Improving Bad Credit 15 Tips for Improving Bad Credit 15 Tips for Improving Bad CreditIf you have bad credit, or you know someone with bad credit, there’s no shame in it! The average American is given very little information about how their credit score works, so it isn’t surprising that many people have less than perfect credit. Unfortunately, that means your options for getting a loan will also be less than perfect, to put it mildly.That’s why it’s important to build your credit rating and we’ve got not one, not two, not three through fourteen, but fifteen tips for building your credit!1. Get a copy of your credit report.As we said, keeping up your credit score can be tough. So you definitely don’t want to suffer because of mistakes that other people made. Federal law requires the three major credit agencies to create a copy of your credit report that you can review. You can get that report through AnnualCreditReport.com, the only official government approved site for receiving your credit report. Check it for errors and c ontact the credit agencies if you need to dispute something. Don’t become the victim of someone else’s goof up.2. Make your payments on time!Is this obvious? Sure. But it’s also the most important way to maintain your credit score, so we couldn’t just leave it out! Howard Dvorkin (@HowardDvorkin), CPA and chairman of Debt.com, put it frankly: “There’s no secret to really improving your credit score. Since 65 percent of your score is determined by payment history and credit utilization (in English, how much available credit you’ve maxed out) all other tips are only going to help you in tiny blips. The first and best way to bulk up your credit score is to start making your payments on time.” Even just one late payment can affect your credit. And he’s not the only one who told us that! Greg Rable, CEO and founder of FactorTrust  (@FactorTrust), says, “It’s basic, but it’s critical to make loan payments on time. It demonstrates both the ability and willingness to pay your debts. This helps consumers get the credit they deserve and improve their credit scores based on their performance.” 3. Consider a secured credit card.Having bad credit can be a bit of a chicken and egg situation. A properly used credit card can be a good way to build your credit rating, but you need good credit to get approved for a credit card. A secured credit card might be the solution for you. You’ll have to put up some money as collateral, but it’s worth it to fix your credit. Once you have the card, you can buy all the chicken and eggs you can afford, as long as you make your payments on time.4. Dont put too much on that credit card.  OK, you know how we just said you should use your secured credit card to buy all the chicken and eggs you can afford? Well, we spoke too soon. Only use it for SOME of your chicken and eggs (and whatever else you’re buying….ketchup maybe?). Author and debt law expert Gerri Detweiler (@GerriDetweiler) sets the record straight: “If someone has low credit scores, the first thing I would tell them to look at is their balances on their revolving accounts such as credit cards. High balances mean high ‘debt usage,’ and that can affect their credit scores. It’s not the amount of the balances that matters as much as the balance in comparison to the credit limit. It’s generally a good idea to keep your balances below 20-25% of your available credit on each card. Also, keep in mind that most issuers report balances at the end of the billing cycle (when the amount you owe is calculated)â€"not after your payment is received.”5. Ask about credit reporting.  Wouldn’t it be nice to be rewarded for just doing the stuff you should be doing anyway? Well, in one narrow sense, you can be! You can try to have different service providers you pay bills to report your payments to the credit bureaus.It worked for Bradley Shaw (@ExpertBrad), a digital marketing expert at SEOExpertBrad.com. “Once I cleaned up my cre dit history, I started looking for ways to build it,” Shaw told us. “I did this by looking for credit lines that could have been included in my file, but weren’t. For example, I’ve had a cell phone in my name for 10 years, but those payments didn’t appear on my credit report. So I made a list of every company I paid monthly, contacted the companies, and asked them to report my payment history to the credit bureaus. Below are the types of companies that were willing to report on my behalf:Cell phone providerCable and internet providerUtility companyOf course, this only works if you’re making your payments on time, so once again make those payments on time6. Get a credit building installment loan.Taking out a personal installment loan that you can  afford to repay can actually improve your creditâ€"if that lender reports to the credit bureaus.These lenders will report your payments to the credit bureaus, so you can actually build your credit score and qualify for better ra tes the next time you need a loan. As long as you’re making your payments on time, that is. Have we been bringing that up too much? Maybe. But counterpoint: you have to make your payments on time.7.  Wait on larger purchases.Nationally recognized credit expert Jeanne Kelly (@Creditscoop) told us: “Having bad credit is expensive. Many times you need to focus on building a better credit score before committing to a large loan. Do your math, see how much the interest rate on a loan is costing you with different scores. See if it makes sense to purchase that new car, new home now or if it is wiser to take some time to work on building better credit.”8. Stay motivated!Paying super high-interest rates for a bad credit loan is not particularly fun, even if the lender is helping you build your credit. That’s why Kelly recommends you try to take that frustration and use it as an incentive to press on harder in your quest to build up your credit: “We know that we usually are not thi nking about our credit until we need it. So, sometimes we get stuck needing a new car loan with a lower score because we have no other option. If that is the case, then try to learn from that higher interest rate and work on focusing on your credit so you can maybe refinance that loan in a year. Don’t just take the higher rate and continue with poor credit habits, learn from it.” You can also learn more about setting and meeting financial goals in our OppU.9. Set up autopay and reminders.  Remember how important we said it was for you to make your payments on time? Well, one good way to do that is to set a reminder on your phone or similar device (a well-trained parrot, perhaps) to noisily let you know your bills are due. Even better, find out if you can set up an autopay system to automatically pay your bills on time. Or you could just read this article every day. Because this article has a lot of reminders about paying your bills on time.10. Pay off your debt!Do you have debts ? You’re going to want to pay those off as soon as you can. You probably know that. You’re a smart person. And if staying out of debt was easy, no one would be in it. But in the long run, you’ll be glad you got out of debt as soon as you could, and so will your credit report.11. Dont be afraid to ask for help!Paying off your debts and keeping up with your necessary payments can be difficult. No one likes asking friends or family for monetary help. But if they can help you build up your credit score now, you’ll be in a better position to help them down the line, if they ever need it. You’re better off asking for help sooner, when you have a bad credit score and manageable debt, then later, if things take a turn for the financial worse. You can learn more about fixing your credit in our blog The Journey to Turn Your Credit Around.12. Dont get sent to collections.  Look, we’ve already told you once or twice that it’s important to make your payments on time. But missing a payment entirely is even worse. That will lead to your balance being transferred to collections. And then things get bad. The collection agency will report your lack of payment to the credit bureaus and that will be a negative mark on your credit report. A negative mark that lasts for seven years. Yep. It’s like breaking a mirror over your credit report.12. Go for the soft credit checks!  Even applying for a loan can leave a negative impact on your credit score, if the lender performs what is known as a “hard credit check.” If you have to apply for a loan with bad credit, consider only applying to lenders who perform “soft credit checks.” These won’t impact your credit score, so you can find out if you qualify for the loan with less worries.14. Avoid payday lenders!  Theoretically, you can use payday loans in a responsible way. If you take out the loan and pay it back in full with all fees and interest in the very short payment time you’re allotted. But that’s a very risky prospect and if you don’t make that payment, you’ll be forced to pay to extend the loan. That’s a great way to get yourself trapped in a cycle of debt, and a cycle of debt is not a good look for your credit report.  15. Make your payments on time!  We’re serious!Its the best and easiest way to stay ahead of debt and keep your credit score moving in the right direction.Visit OppLoans on YouTube | Facebook | Twitter | LinkedINContributorsGerri Detweiler’s passion is helping individuals cut through credit confusion. She’s written five books, including the free ebook  Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights, and her latest, Finance Your Own Business. Her articles have been widely syndicated and she’s been interviewed in over 3000 news stories. She serves as Head of Market Education for Nav, the first and only site that shows small business owners their free business and personal credit scores and tools for building strong busi ness credit.Howard S. Dvorkin  is a  two-time author, personal finance expert, community service champion and Chairman of Debt.com. As  one of the most highly regarded debt and credit expert in the United States and has played an instrumental role in drafting both State and Federal Legislation.  Howard’s latest book “Power Up: Taking Charge of Your Financial Destiny” provides consumers with the detailed tools that they need to live debt free and regain their financial freedom. Howard has appeared as a finance expert on CBS Nightly News, ABC World News Tonight, The Early Show, Fox News, and CNN.Jeanne Kelly  is an author, speaker, and coach who educates people  to help them achieve a higher credit score and  understand credit reporting. #HealthyCredit is her motto.  As the founder of The Kelly Group in 2000 and the author of The 90-Day Credit Challenge, Jeanne Kelly is a nationally recognized authority on credit consulting and credit score improvement.Greg Rable  brings more th an 20 years of strategic development, management, and technology experience to FactorTrust, along with extensive experience in electronic payment, online commerce, and communications. Since founding FactorTrust, Greg has overseen rapid growth in the US and expansion of our services to both the UK and Canada.Bradley Shaw  is a Digital Marketing specialist for businesses that want to see their Google search rankings surge. Based in Dallas, TX he has more than 20 years experience in Online Marketing. Currently, he is the President of SEO Expert Brad Inc.