Thursday, March 26, 2009

The Solution Could Be Credit Restoration

By Jenice Q Zenbella

Since the global credit crunch took hold and economies worldwide have been in a slump, it's tough to secure a mortgage. This makes it more important than ever to keep your credit score high. You can use credit restoration to put things right again if you run into financial trouble ? but it's best to protect your credit from being harmed. Whether you're new to using credit or have had multiple accounts for some time, you should keep a few things in mind about taking good care of your credit score and how to use credit restoration if you do run into trouble.

One of the most important things to know about your credit score is that about 35% of it is based on your payment history. Your credit report goes back seven years; but it is the two most recent years which potential creditors will be most concerned with. How late your payments are makes a big difference. A payment which is 30 days late is not too serious, but one which is more than 90 days late is a big problem. Remember, it's easier to keep your account in good shape than it is to repair it.

Try to maintain various types of credit accounts in good standing. For example, have a credit card which has a low or no balance, an installment loan (a car loan, for instance) and if you can, a mortgage as well. When creditors see that you can effectively manage different types of credit, they are more likely to extend you credit.

Never apply for credit which you don't really need. You can harm your credit score y opening too many accounts or making too many inquiries. When you open these unnecessary accounts, you'll also be tempted to use them ? this can open a whole new can of worms. Avoid needing credit restoration by resisting the temptation to open accounts you don't need.

You should request a copy of your credit report. Look this over carefully and be sure to dispute any item which is inaccurate. You can request that these erroneous items be removed from your report. If there are any small balances outstanding, pay these off.

Contact them and offer them a settlement. In many cases they will reduce the debt, sometimes by as much as half. Work with them to pay off your debt. This settlement will still be a mark on your credit report, but it is vastly preferable to having that unsettled debt on your credit history.

Even if you play by all the rules, things will happen ? you may still find your credit being damaged due to factors beyond your control. Don't let it get you down. You can repair your credit; just remember that credit restoration can take time. If you keep your eyes on your goal, you will be able to repair your credit.

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