Credit Repair mistakes you should avoid in your financial life
If you find your credit report with a lot of negative listings and a low credit score, then it’s time to repair your credit. Credit repair is not a simple and a quick thing that you can do in one or two days. It takes some time and in most case it requires more than a month to raise your credit score. If you are going to repair your credit or if you are going through that process, then you have to be careful to avoid some mistakes that usually occur during the credit repair process. I’m listing here some of the most common credit repair mistakes that you should avoid in your financial life.
Completing ignoring your credit report : – the first and probably the biggest mistake most of the people make is to ignore their bad credit report completely without even trying to repair it. For such people, it may not be a big problem at present, but after a few years, the bad effects of your poor credit will began to come up. If ever you come in need of a loan or insurance or a credit card, then a bad credit can make it very expensive or sometimes even you get denied of these things. So, it’s better late than never. Go and check your credit report and repair it as soon as possible and try to maintain a good credit score throughout your life.
Cancelling your credit card accounts : – most of the people make this mistake without realizing the fact that by closing your credit card account can bring down a good portion of your credit score. Especially closing the credit card account with a balance or an older credit card can affect your credit score very significantly.
Following illegal schemes for credit repair : – if you are going after credit repair companies who give promises to repair your credit in a few days by undertaking illegal means, then you are doing a lot of harm to your financial position. You cannot repair your credit in any easy method. It takes time and effort to solve the credit issues, but still it can be solved. Some of the common illegal practices the credit repair companies undertake are, to create new credit identity, disputing every entry on the credit report, using new tax identification number to appear in good credit standing etc., which brings you into a lot of legal issues.
Failing to follow up with your repairing activities : – once you have begun your credit repair then do it sincerely and with patience. There is no way to repair your credit quickly and in an easy manner. So patience is required for this purpose. You may have to spend months to raise your credit score, but if you are not following up on the activity, then you cannot be sure that the credit repair is having the right impact.
Paying off debt with your credit card : – some of the people try to pay off their old debts with their credit card, thinking that they can raise your credit score. But, actually they are bring more debt with more interest rates by using their credit cards. So don’t fall in this financial trap.
Not checking your credit report : – most of the people tends to make this mistake. They begin to repair their credit without even checking well, on what all they have to focus to repair their credit. You must have a copy of your credit report in order to begin the repair from the start.