Suffering from Bad Credit? 5 Tips to Recover That Credit Score

If you find that your financial history involves a foreclosure, a long string of continuous past-due payments, or accounts going to collection, your credit score probably took a major hit. However, just because you currently suffer from bad credit, you can take control to rebuild it. The five tips below can help you recover that score and begin improving your financial health.

#1 Begin the Pay Down

Begin paying down on your debt, and avoid incurring any new debt. If you find you are loaded with multiple cards, begin paying off those with the highest interest rate, while you continue to make a minimal payment on all the remaining ones. Once the card with the highest rate has been paid off, start paying down on the one that has the next highest rate. As soon as all of your credit cards are balanced to zero, your credit worthiness will begin to rise.

#2 Keep Score

It is important to know exactly what is on your credit reports to ensure they are free of errors. Any mistake can have a dramatic negative impact on your score. Dispute every obvious error by providing documentation sent directly to the credit bureau. This will allow them to promptly fix any outdated or inaccurate information.

#3 Begin Using Cash

Simply because you have credit cards does not mean you need to use them. When deep in debt, it is important to put a spending freeze on every single credit card. This will provide the ideal breathing room you need to save money to pay down your debt balances quickly.

#4 Create a Budget

Creating a budget is a quick solution to understanding what is causing you to fall deep in debt. Only purchase items and services you need and can afford. Stop wasting money eating out, watching cable TV, or paying for unnecessary cell phone service.

#5 Pay Every Bill on Time

Creating a bill payment calendar is an easy way to ensure that every bill is paid in a timely manner. Missed payments will lower your score and generate late fees, even if the payment arrives just a few days late. Set up a bill payment online through your bank. This usually free service eliminates costly mistakes.

While credit provides the opportunity to make life easier, it can create tremendous anxiety when not handled properly. When your financial trouble is overwhelming, a bankruptcy attorney Omaha firm can assist in restoring financial health to get you back on track.



Brionna Kennedy is native to the Pacific Northwest, growing up in Washington, then moving down to Oregon for college. She enjoys writing on fashion and business, but any subject will do, she loves to learn about new topics. When she isn't writing, she lives for the outdoors. Oregon has been the perfect setting to indulge her love of kayaking, rock climbing, and hiking.