Boost Your Credit Score Without Losing Your Mind

It is counter-productive to spend loads of money on credit repair books and schemes that are advertised on TV and on the Internet. With a few basic tips and knowledge about how to build your credit and maintain a good credit score you can get this information just by reading reputable forums, blogs, and financial advisor radio/TV shows.

To get you started, you will want to download your three free credit reports from each of the reporting agencies. The reports are free but you have to pay a small fee to see your actual score. If you want to do this for all three, you can, but if you are strapped for cash, just do that on one of them. Typically the others are within the same range.

Once you receive your reports, you will want to go over them with a fine-toothed comb. Make sure there are no inaccuracies or suspicious activity. Some of them you may not remember. Rather than assume it is supposed to be there, call the company. Let them know you have a copy of your credit report and you do not recall having an account with them. Let them do their job and provide you with the information.

If you have anything on your credit report that shouldn’t be there, you will need to dispute them. Each reporting agency will have a form that you can fill out to do that. This also includes any negative reporting when you feel there should not have been any negative reporting.

Once you have finished that step, then you need to see if there are outstanding bills or debts that you were not aware of. You will need to verify these as well, but if they are legitimate, they won’t go away until you satisfy the payment. Call the company and see if there is a payoff amount they will accept. Often you will be able to settle your final payment for less than what you originally owed.

Once you have discovered all the debts you owe, make a list starting with the debt that is the least amount, all the way to the one that is the biggest amount. You want to also work on your personal monthly budget so that you can have a system that allows you to pay all your bills by the due date. Any additional income needs to be applied to your debts.

You want to start with the debt that owes the least amount of total money. Let’s say you have a bill for $200, and you have allocated $100 a month for debt payoff. Do not stop paying your regular monthly amounts on the current bills, but also do not try to take that $100 and spread it out $10 here and $20 there on several bills. Concentrate on the lowest one. In the example, you will have the lowest debt paid off in two months. You can then cross that debt off your list.

Then you will go to the next debt. In the meantime, you realize you had been spending several hundred dollars in eating out and buying coffee every day, so you have committed to buying groceries that provide better nutritional quality and make your own coffee at home. If you can find a way to reduce the expenses so you can put more on your debt, all the faster you will be able to pay it down.

You will find that very quickly, your credit score will increase. You will not want to have your credit score pulled again from any that you have pulled because that actually decreases your score. That’s why it is better to just do one credit reporting agency to get an idea. Then once you have spent a couple of months cleaning up your report, paying on debt, and making on-time payments for everything else, you will be able to pull another company and find out your score there. Each company has their own rating system, so do not be discouraged if your score doesn’t seem to move much at first.

Keep working on your debt payoff and timely payments and you will see a huge difference next year when you pull all your reports and scores again!