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How to fix bad credit history - effects of bad credit score

Having and maintaining a good credit score is getting more and more important as each day passes. There is a tendency in most of us to spend a lot, and thus to carry some form of debt, more than it is healthy. Such habits affect our credit ratings negatively, which sometimes take years to fix. In today’s worsening global economic environment, it can spell a lot of financial problems for you if your credit report is not up to the mark.

Bad credit reports and bad credit score, which ultimately translates to, affects a lot of things. A bad credit report and credit score puts many restrictions in your life. Here are some ways it does:

  1. A bad credit score means you’ll be paying higher rent per month- That’s right! Landowners shall take one look at your credit report and tell you that you can’t stay there. And even if they do let you stay on a rent basis, that rent can be high due to your credit score. You see, a low credit score and unsatisfactory credit report say that you may not be able to repay loans and pay rent.

  2. You’ll be getting loans with bad deals: This means getting loans with a higher rate of interest than someone with a better credit report. While the other person is seen as more trustworthy, you may not be.

  3. You may not be getting loans at all: A bad credit report says you may be unable to repay, and thus you may be missing out on the best loans and good deals.

And so on and so forth. There are other ways it can affect your life negatively.

How is Bad Credit Affecting You, and How to Fix Your Credit History

The good news is that there are 5 things you can do to fix your damaged credit. 

  1. Get an accurate copy of your credit history. This you can do either by asking for the free copy from credit bureaus, or by using credit monitoring solutions to get credit reviews anytime.

  2. Evaluate your credit accounts. Check for miscalculations. You also want to know how to work out with companies associated with this.

  3. Understand how loan agencies work and run, and how their dispute processes work. You may want to write a letter to credit reporting agencies, in which you should be able to tell where exactly in their dispute process you are. This will help these agencies to understand your situation better, and thus help you out faster.

  4. Initiate the dispute procedure with credit reporting agencies. Ensure that you know their laws and regulations very well, apart from the dispute process of course. This will take a bit of time, and there will be some back and forth communication. In this meantime, you may want to read other literature on how to best engage with credit reporting agencies during this time. If it takes time, don’t get frustrated because the process does create results.

  5. Get another copy of your credit history to ensure that these credit agencies have complied with you and have eliminated the problem from record.

Educating yourself on how credit agencies and businesses operate, you’ll be in a much better position during such times.

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