Simple ways to fix bad credit on your own

credit cards

If you’ve incurred a steep credit card balance or overdue loans over time, there’s a good chance you have less than stellar credit. If so, you might be struggling to get approved for things like new credit cards.

While it’s possible to live with bad credit, you’ll find yourself at a disadvantage when you take out a mortgage or when you apply for car finance. Because of your poor credit standing, you’ll be paying for a higher interest rate.

So, if you want to avoid paying higher interest rates and get favourable terms, you’ll need to improve your credit as soon as possible. Before you get tempted to ask someone else to fix your bad credit, consider doing it yourself.

The reality is, repairing bad credit is something you can do on your own. In fact, there is nothing a credit repair company can do that you can’t do yourself. With a little bit of insight and some patience, there are steps you can take to rebuild your credit.

Save time and money by trying these simple ways to repair your bad credit.

  1. Check your latest credit report. Knowing what needs to get fixed is crucial. So, get the most recent copy of your credit report. Try to visit sites like Equifax.co.uk or Creditreport.co.uk to request a free credit report. Once you’ve acquired a copy, read it thoroughly and see which items have negatively affected your credit score.
  1. Look for errors in your credit reports. If you happen to identify any possible errors in your credit report, you can try to dispute them. While these errors don’t happen very often, it’s still worthwhile to review items like major purchases, outstanding debts, among others.

So, when you see anything questionable, remember to highlight it in your report. The next step is to collect any information to support your claims, such as bank account statements, and make extra copies of them. It is important to have proof when you get in touch with the credit bureaus.

  1. Try to negotiate a payment plan. If you’ve been struggling to make payments in the past, you can try to reach out with your creditors and work out a payment plan, so you can catch up on any missed payments. Remember, your payment history plays a huge role in determining your credit score.

Every time you incur a late payment, this will damage your credit score. To avoid missed payments, make sure you pay any bills like internet, utilities, rent and such on time. One effective way to do this is by having these bills automatically deducted from your bank account.

  1. Start paying down your credit card debts. If you have outstanding balances, make sure you pay them down, little by little, until they are gone. Do not go over your credit limit. This way, you won’t max out your credit cards.

Another factor that may negatively impact your credit score is closing credit cards you’ve had for a long time, especially when the account still has a balance. So, be very careful when deciding to close them.

  1. Avoid applying for new credit. No matter how tempted you are, do not apply for a new credit card as this can hurt your credit score. Get your credit in order before applying for new lines of credit.

While you can’t expect to repair your credit overnight, if you get a good sense of where you stand financially, you can focus on reducing your credit card debts, making sure you pay every bill on time and limit your spending.

So, no matter how long it takes to rebuild your credit, don’t give up. When you develop good financial habits over time, you’ll benefit from having a healthier credit score, especially when you decide to make big-ticket purchases, like a new house or a new car.

You can confidently approach lenders knowing that you won’t be rejected because of poor credit.