Steps To Rebuild Bad Credit A witness wants to know
The pandemic has been a financial fiasco for some of us, forcing many to turn to credit. How to rebuild your credit score after you run out of cards and miss payments.
TEXAS, United States – The pandemic has had a drastic effect on finances. Many have suffered job losses, price increases and health care costs. Fickle finances meant inflated budgets. Many of us had no choice but to put the essentials on a credit card. Repairing your credit score may be a faster process than you think.
âAs soon as you make a plan and start from scratch, you can start making improvements,â said Nathan Grant, senior credit industry analyst at Credit card insider.
Step one: Check your credit report. Find out your score. You need to know where your score is so you can get it where you want it. Make sure you are not a victim of identity theft.
âDuring the pandemic, fraudsters took advantage of people’s fears and concerns,â said Rod Griffin, senior director of consumer education and advocacy for Experian. âSo check this report. “
You can get your report for free every week at AnnualCreditReport.com.
Step two: start making payments on time.
âNot making payments is the biggest mistake people make because it shows they are not fulfilling their obligations under the contract and is a huge indicator of risk for lenders,â Griffin said. âSo your scores are going to drop dramatically. “
A late payment can stay on your credit report for seven years from the date of the missed payment.
âIf you’ve missed a payment, talk to your lender,â Griffin said. “They can tell you that they’ll take it off the report or they just won’t report it and you can get it back quickly.”
Step Three: Find tools to show positive payments to increase your credit score. Experience Offers Experience boost free.
“Experian Boost will allow you to add your positive cell phone payments, your positive utility payments, your positive streaming service payments like Netflix to your credit report, which was not possible in the past,” he said. Griffin said. âWe add them as accounts to your credit report to show this positive behavior. What we’re seeing is that on average, people’s scores increase by about 12 points for every two in three people. If a person has had problems, we are actually seeing increases of almost 19 points. “
You can also open a secure credit card.
âYou’ll actually make a security deposit that funds the card’s credit limit,â Grant said. âLet’s say as an example, it was like a $ 1,000 credit limit. You would pay this deposit. Even if you funded the deposit, it still reports all payment activity to the credit bureaus just like a normal credit card. You get this deposit back at the end.
Or get a store a credit card.
âThey’re a little easier to ask for, but often times people make these regular purchases every month anyway,â Grant said.
Store cards have higher interest rates, so make sure you pay off the balance monthly.
Also consult the best credit cards for those with bad credit.
Paying your bills on time and paying off your past debts will quickly start to boost your credit score.
If you have a question an eyewitness wants to know, email us at [email protected] or call us at 210-377-8647.