[Y]ou hit rock bottom with your credit. All of your accounts went to collections and your car was repossessed. You don’t even want to check your credit score because you know it’s bad. While the situation might seem hopeless, you can turn it around. Once you’ve lost any credit worthiness, you are ready to work on rebuilding.
Check Your Credit
As much as you don’t want to, you need to check your credit report. You need to know what it says, the good and the bad. Make sure everything is accurate even if it isn’t good. Make a note of all of the negative information listed. Don’t let it overwhelm you, but just know what others will see.
Get a Secured Credit Card
If your credit is really bad, you probably won’t qualify for a traditional credit card. However, you can get a secured credit card, which means you will pay a deposit to the creditor in return for a card with that much credit. If you pay $500, your credit card will have a credit limit of $500. Make sure the creditor reports to at least one of the credit reporting agencies. It will report just like any other credit card, so as long as you pay your bill on time or pay the balance, it will add positive information to your account.
Get a Small Personal Loan
If you can get approved for a collateral loan through your bank or another lender, this is another way you can begin re-establishing your credit. A collateral loan uses something you own to back the loan if you should default.
Unfortunately, you’ll have to play the waiting game. It often takes six months for the information on a new loan or credit card to show up on your credit report. At that time, you’ll see at least a small improvement in your credit score. Once you have begun to establish an improved credit history, other creditors will be willing to give you a chance. Then, you can get an unsecured credit card or other form of credit to help you continue to build good credit.
[I]f you have a goal to improve your credit score for the new year, you need to set up steps to help you achieve this goal. For many, they read all kinds of information about how to get a good credit score, and it can be overwhelming. Sometimes, it can sound so easy but not […]
[T]here are three major credit reporting agencies: Experian, Equifax and TransUnion. All of them provide a credit report which lists your personal information and credit accounts. You can get one report for free each year or purchase extra reports through the agency sites. Many people just get one credit report, but you really should get […]
[A]s you get credit cards, you will notice they give you a credit limit. This is the maximum amount you can spend on the card without paying some of it off first. Credit card companies often increase your credit limit as you prove responsible handling the amount you have. You may wonder if more credit […]
[I]f you have bad credit, it can be difficult to qualify for a car loan. However, it’s not impossible. Before you go out and apply for money to purchase a vehicle, there are some things you should know. Check Your Credit Before you fill out any applications for car loans, you need to take a […]
[M]any people hear that they have bad credit, which means they haven’t always been responsible with their credit accounts. However, it is another situation entirely when a person is told they have no credit. You may wonder how that’s possible and what it really means for your future. No Credit Doesn’t Mean Never Any Credit […]
[T]ransUnion is one of the three credit bureaus which stores information about consumers and their credit history. It provides this information to creditors and to consumers. TransUnion was founded in 1968, and it now has more than 200 offices through the US and the world. How TransUnion is Different TransUnion is similar to the other […]
[E]quifax is one of the three major credit reporting agencies which provides information used on your credit report. It has a credit score which will impact your ability to get approved for new credit. All of these agencies aren’t the same, so here is some information you should know about Equifax. Equifax is headquartered out […]