3 Reasons You Should Start Rebuilding Your Credit Now

by Megan Hartman on May 14, 2012

Everyone should be striving for a credit score of at least 680. This is the score at which borrowers can start getting better rates on loans. Lenders want to know that you are not a risk to default on a loan. Borrowers should start thinking about rebuilding credit as soon as possible.

It Could Make Getting a Job Much Easier
Your employer wants to know you are responsible. Someone with a credit score of 500 is far from responsible. Even a great resume cannot always save you from a terrible credit score. Start making plans to improve your credit as soon as possible.

One thing to think about is taking out a secured credit card. Secured lines of credit are obtained by depositing your own money into the account. Your credit line is based on how much you initially deposit.

Your Family is Going to Grow
It is hard to raise a family in a tiny apartment. Doing so is even harder if you are stuck living with your parents. You will have a hard time getting a bigger place to live if you have poor credit. Start rebuilding your credit at least two years before you want to apply for a mortgage.

Your best bet is to apply for an FHA loan. These loans help people with lower credit scores get loans. They will meet you halfway if you can prove you are getting serious about your finances.

You Can Negotiate With Your Creditors
The easiest way to improve your credit score is through a debt settlement. Your creditors will agree to accept a lump sum payment for half of your current balance. Using a credit counselor may allow you to pay this settlement in installments. A friendly creditor will note that your accounts are paid as agreed. This will significantly raise your credit score. The reduced debt amount will also help your credit score.

Getting your credit back to where you want it to be isn’t that hard. All you have to do is get into a habit of paying your bills on time. Lenders are more concerned about your ability to pay bills at the present time. They don’t care as much about what you did a year ago. Increasing your income is another way to appease lenders. People with higher incomes have a better chance of paying their bills each month. Start taking steps to improve your credit as soon as possible. There is no reason why you should live with poor credit.

Categories: Building Credit

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