Best Way to Rebuild Credit

A person’s credit can significantly affect his or her major financial decisions–having good credit makes it easier to get loans, enjoy lower interests, and work on better terms. But financial challenges can take a toll on one’s credit score.

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Fortunately, there are several steps you can take to rebuild it, like paying your bills on time, keeping your credit utilization low, being careful with new credit, and consistently practicing good financial habits. Another great way to do this is to hire a Dallas credit repair company like The Phenix Group, which can review your credit reports and help you settle any issues and improve your score.

How to Rebuild Credit 

Rebuilding credit can be tougher than starting from scratch, as you’re trying to prove that despite financial shortcomings–even those not of your own fault–lenders, credit card issuers, or other credit organizations can trust in your financial responsibility. Luckily, even incremental changes can impact your credit score, and every step you take can lead you toward better financial options than you have today. These steps include:

Review Your Credit Reports

Your credit score is affected by several factors. You must understand these to figure out your current credit worthiness and pinpoint areas where you can improve. Request a free annual credit report from the three major credit bureaus: Equifax, Experian, and TransUnion. If there are any errors, dispute them immediately, as these can hold you back. Correcting these mistakes can potentially add points to your credit score quickly.

Pay Your Bills on Time, Every Time

Your payment history is one of the biggest factors that affect your credit score. Missed or late payments can leave a mark for up to seven years. Pay your accounts on time, every time, even if it’s just the minimum amount–though you should work on paying in full as you go. Consider setting up bill reminders or automatic payments to keep up with your bills.

If you have some debt you’re unable to repay, you might wonder, does settling a debt hurt credit? While it’s still perceived negatively in your credit score, it’s better than just leaving the debt unpaid, since it shows you’ve reached an agreement with your lender.

Mind Your Credit Utilization

Using too much of your credit limit can hurt your credit score; most experts recommend you never go over 30% of your credit limit–the lower, the better.

Try a Secured Credit Card

Your credit score can go down if you open too many accounts in a short period. Instead, consider getting a secured credit card that requires a deposit upfront but works like any other credit card. Paying the bills that come from this responsibly can positively impact your credit score. 

Credit Repair Companies: The Best Way to Rebuild Credit Score

While you can rebuild your credit yourself, it’s helpful to get some assistance from a credit repair company like The Phenix Group. These organizations are designed to help consumers improve their credit scores through the guidance and advice of experts who know their way around credit laws, consumer rights, and financial regulations.

How a Credit Repair Company Can Rebuild Credit

How does a credit repair company work, exactly? The first part of the process is analyzing your credit report and tracking down any errors. The company can then gather evidence and submit it to the relevant parties to challenge disputes. As previously mentioned, you can also do this yourself, but having a credit repair company like The Phenix Group can help you navigate the complex bureaucracy properly. 

Aside from fixing credit issues, a credit repair company can also educate you about budgeting and finance, following credit laws, and best practices. They will base their advice on expert knowledge and years of experience, so you can be sure you get the best advice.

Conclusion

Your credit score is an overview of your financial habits, particularly your ability and responsibility to settle your bills on time. Maintaining it is key to better financial options, but there may be obstacles that can bring it down. Should this happen, there are some steps you can take to rebuild your credit–one of the most convenient ways is to hire a credit repair company like The Phenix Group. With their team of experts, they can help you improve your credit rating by fixing errors, negotiating with credit organizations, and guiding you toward becoming more financially responsible.

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