Get Help With Bad Credit, Debt Relief & Loans
 
 
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Help For Bad Credit


You've tried to keep your credit report clean, but it happened. You lost your job, you got stuck with medical bills you couldn't pay for, or your spouse needed financial help and neither of you had a savings plan in place. You got behind on your bills, your creditors are calling, and you know your credit is in bad shape. Maybe you've already thought about (or gone through) bankruptcy. What do you do now? There is life after debt, but you'll probably need help with your bad credit.


Financial Counseling


The first step you should seriously consider is getting help with your budget, basic money management skills, and learning to develop a healthy relationship with credit cards and other types of debt. There's just no substitute for education. Most money problems stem from poor financial education and spending habits. Sometimes, poor saving habits exacerbate an existing problem and those bad habits often go hand-in-hand with a lack of financial discipline.

It may be harsh, but you need to buckle down, get serious about your finances, and start taking more responsibility for your financial situation. You don't have to beat yourself up, and you shouldn't let others do it either. Just accept that you need financial counseling, and seek out an organization that can help you.


Dispute A Debt

Even when you pay off debts, some creditors are a bit lazy about reporting it to the credit bureaus. If you've already paid off a debt, or made arrangements to pay off a debt, you shouldn't continue to receive derogatory remarks about it on your credit report. Sometimes, erroneous information gets reported (i.e. if you've ever had your identity stolen) about you and you have to go on the offensive. A good credit repair and credit counseling organization can help you dispute erroneous information on your credit report.

You cannot have legitimate derogatory remarks removed, but you can have false information corrected or removed. Because the area of the law that deals with this can get pretty complicated, it's best to have someone help you with it. Technically, you can dispute items on your credit report yourself - it just helps to have a lawyer or an experienced organization behind you so that you don't make any mistakes.

Regardless, the process is the same whether you do this yourself or you have a company do this for you. First, you must request a report from the three major credit bureaus (Experian, Equifax, and TransUnion). Then, you must find the erroneous derogatory remark. Finally, you must send a letter to each of the credit bureaus that have erroneous information listed and tell them to verify the debt in question. If you really don't owe the debt, the credit bureau won't be able to find a legitimate record of it and it will be removed.


Signature Loans and Piggybacking

 

When you start on the road to credit recovery, one of many options you have to rebuild your credit is to go to your bank and ask for a simple secured loan. These loans are issued in very small amounts and are backed by money in your bank account. The money you deposit acts as a guarantee to the bank. If you default on the loan, the bank takes the money in your account to retire the loan. By making multiple secured loans in this fashion, you establish your loan-paying ability and demonstrate to lenders that you are financially responsible.


Department Store Charge Cards and Other Loans


After six months of borrowing and paying off secured loans, the next step to getting help with your bad credit is to apply for store department store cards. Yes, the interest rates on these are high, but you need to show lenders that you are financially responsible and store cards up the ante a bit. With secured loans, there's a safety net. With department store cards, there's no net. It's unsecured debt. Don't take on more debt than you can handle, but be sure to get a few cards and keep a small balance on all of them most of the time.

Cycle through the cards, periodically paying them off, and then charge them up again. Never charge up more than you can pay off in one month. Keeping a balance on the card, however, shows lenders that you know how to manage debt responsibly. That's important.

When you have a handle on store cards, it's time to apply for a variety of other loans. Car loans, maybe a mortgage, personal loans (both secured and unsecured). This last stage may take several years, since it takes a lot for lenders to trust you with their money if you're starting from a position of having bad credit. Be patient.


There's No Secret To Repairing Credit


The secret to improving your credit is that there is no secret. It's a matter of demonstrating that you're an honest, responsible, person. Taking out loans, and then repaying them, is how you build up a good credit rating. There's also no real secret to working with credit repair firms and credit counselors.

Unless you know what you're doing, it's best to hire a company that does. Ask about all fees you'll be charged, and what services the company will perform. No company can legitimately guarantee you anything, since they don't determine your credit score. Lastly, while many credit repair companies, and credit counselors, do charge money, you shouldn't pay exorbitant fees for these services. Credit counselors, for example, should charge you $50 to $100 for debtor education courses and budgeting help. Credit repair companies charge more, but the average cost should fall somewhere between $49 and $99 per month.

Finally, never sign anything you don't feel comfortable with. If something seems wrong, back out, think it over, and consider another company. Taking a few days to get quotes from other companies or to talk to other organizations is better than rushing in just because a company representative is pressuring you to sign up. You should never feel forced to use one organization's services over another.