- Where do you stand right now?
Do it yourself credit repair is not that difficult. There are three national credit bureaus that you need to be aware of if you want to fix bad credit. In fact, the Federal Trade Commission strongly encourages you to review the information contained on all three national credit bureaus at least once a year. This is your first step. You need to obtain and examine all three.
It's estimated that as many as 40% of all credit reports contain errors. If you find errors on your report you must get these corrected yourself by contacting each bureau. Do not apply for any additional credit at this time, doing so will only lower your score further. Every inquiry made, except those made by yourself will reduce your credit score. The first thing you need to do to fix bad credit is clean up your current credit report. If you want to avoid the credit repair scams, do it yourself credit repair is probably the best way to go.
- Devise your personal plan of action.
You must pay your bills on time. Decide if you have the income to meet all of your obligations. If not contact your creditors as outlined in step three, and see if you can work out a reduced payment schedule and stick to it. Or it may be easier to Consolidate Your Debt & Lower Your Monthly Payments!
If this is not possible and you are considering bankruptcy as an alternative, be sure to consider the impact it may have on your personal finances for years to come. Bankruptcy may not the end of the world but it will be with you for years.
Do not throw your credit cards away, you may need them to help you reestablish. Put them aside and resolve to live without them. Using your cards now will only serve to further burden you with additional debt.
- Talk with your creditors.
They can help. Call or write all of your creditors and explain your situation to them. Remember, they are not the reason for your situation and they may be able to help you out. You may want to negotiate for a reduced payment that you can afford to make. You will find that most of your creditors will be willing to assist because it is in their best interest to do so. However, you must abide by whatever agreements you make with them and make your payments in a timely manner.
- Monitor results and stick to your plan.
Review your file every few of months to make sure that any errors that you have disputed have been corrected. After a period of time inquiries will no longer count against you provided you haven't been applying for credit.
When you're begin to see light at the end of the tunnel, be careful it could be the train coming. If you start to use your credit cards again, use them on a very limited basis and only if you can pay them off when you get the bill. If you have no extra income at the end of the month you won't be able to pay your balance off. Don't use your cards until you can do this. Your goal should be to carry no balance.
It wouldn't be unusual for your score to improve by 20 to 30 points in as few as a couple of weeks. This is the exception and not the rule but it can happen. It will likely take much longer to improve your score. Time is on your side and if you follow these steps your score will improve. Be patient and stick to your plan and you will succeed.
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