A Guide on How to Repair Your Credit

To compute your credit score, points are added when you make on time payments and points are subtracted when you pay late. Some other things that can have a negative impact on your credit score include large amounts of debt, making minimum or zero payments, repossessions or filing for bankruptcy. The following is guide on how you can repair your credit.

One way to remove the debts on your credit report is to file for a bankruptcy, which results to a clean slate in terms of your debt. Moreover, you will no longer have debts, and no longer lose points due to those debts and late payments. However, only a few creditors check the actual credit report.

Although you will lose points for filing a bankruptcy, it is not like having a large amount of debt where you lose points every month. For this reason, a few people consider filing for bankruptcy as a way to rebuild your poor credit.

In contrast, you can build positive information in your credit report by paying your current accounts on time or even before due. Paying on time also means having enough money available. To be able to have available money, you must also modify your spending habits or lifestyle.

Your credit score is a number that is somehow an assessment of your ability to pay your debts. In fact, paying off a small account will earn you as many points as making your monthly payments.

Contrary to belief of some people, repaying delinquent debts will not increase your credit score. It will even decrease your credit and remains in your report relative to the date of your last payment, unless you can eliminate it by discussing with the creditor.

In addition, marriage does not have any effect on your credit score. However, if you apply for credit as a couple, the person with poor credit will harm the one with good credit. It is recommended to wait for the completion of the repair process and not apply for joint credit.

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