text: Your Life After 25: You Can Repair Your Credit Score - Your Life After 25:
  Tag: Credit Score, Investment Quotient
  Did you spend your first years as an adult living it up, using credit cards to fulfill your every desire? If so, you're not alone. So many young adults live lavish lifestyles on credit only to regret it later when they find themselves deep in debt and with a poor credit score that makes it much more difficult for them to secure mortgages and bank loans that they need to advance in life.
  The good new is, if you find yourself in the position of having a poor credit score, it's actually pretty easy to turn things around in less time than you might think. You just have to get up and really make an effort to do so. To help you with that, here are some simple steps that, if you take them now, will repair your credit score in no time at all:
  First of all, you need to obtain a copy of your credit report, so that you can see how much damage you've done. You can do this by following the links at https://www.ftc.gov/faq/consumer-protection/get-my-free-credit-report. Once you've got your credit report, you will need to go over with it with a fine-tooth comb to ensure that there are no errors and no debts attributed to you that you are not responsible for. If you find any mistakes, you will need to get in touch with the credit report company to have your report amended.
  If you've missed payments on a credit card or stopped paying back a loan when times were tough, you can't pretend it didn't happen and expect your credit score to improve. What you need to do is get in touch with your creditors and try to negotiate with them. Some will be convinced to write off debts that are old and which were send to recovery agents, which will help you out and you may even be able to convince some to amend your credit report in a positive light if you agree to pay off the remaining balance in full, especially if you have mitigating circumstances that caused you to default.
  Ensure Your Limits are Accurate
  When you have your credit report, you should always check that your reported credit limits are accurate. If they are wrongly reported as being lower than they are, it will look like you're more 'maxed out' than you really are and that will have a negative effect on your credit score, which could prevent you from getting more credit when you really do need it.
  If you closed all your credit accounts because you were having trouble making repayments and you didn't want to get into even more trouble, you might want to have a rethink, because having an active credit card or two, or even taking out a payday loan, and making regular repayments can help to boost your credit score and show lenders that you are able to behave responsibly around money. Just make sure that you pay off any debts at the end of the month if you want to avoid getting into trouble again.
  If you can't get a traditional credit card, then look for a secure card specifically aimed at rebuilding credit, instead.
  If you have a friend, spouse or family member who is happy to make you an authorized user on their credit card, it will help you get back on an even keel and, again, show everyone that you are responsible, but only do this if you really are confident that you can use credit responsibly and put everything in writing, so that there are no disputes. The last thing you want is to fall out with a loved one due to money.
  Don't Spend More Than 30%
  Just because it is a good idea to use some credit when trying to repair your credit score, doesn't mean you should go mad. In fact, if you want your credit score to be as high as possible, you should aim to use no more than 10 percent of the total credit available to you, and definitely no more than 30 percent. You should stick to this rule even if you plan to pay off the whole balance at the end of the month because doing otherwise would still have a negative impact on your credit score.
  This isn't always possible when you have a chequered credit history, but if you are lucky enough to have the opportunity to increase your credit limit, you should probably take it because this will increase the overall amount of credit you have, making it easier to stay within the 10-30 percent limit suggested above. Of course, you should only do this if you are confident you won't start spending more now that you have more room to maneuver.
  While you're trying to repair your credit score, it is even more vital than usual that you make a real effort to pay all of your bills, not just your credit card and loan bills, on time because a huge 35 percent of your FICO score is based on your payment history and paying even a few days late on a regular basis can make it really difficult to rebuild your score.
  If you need to apply for credit, whether it's to boost your credit report with a credit card as mentioned above, to finance a new car or acquire a bank loan to carry out home repairs, you should never apply for too many avenues of credit at once because it raises a whole lot of red flags and pushes your credit score down. If you can, apply for one thing at a time, and if you're refused, wait a while before trying your luck elsewhere.
  If you're struggling to pay off numerous debts each month, it might be worth looking into debt consolidation loans, which if you choose wisely, will cut your monthly payments down to a more manageable sum, so that you don't have to miss any more payments, and you can really concentrate on paying your debt down and building your credit score back up.
  All of the above suggestions will help you to get your credit score under control for now, but unless you change some of your bad financial habits, it won't be long until you're back in the same position again. One thing you can do to get some perspective on your finances and start living more within your means is to draw up a monthly budget which takes into account your incomings and outgoings (including debt repayments) and ensures that you always spend less than you earn. This, along with a change in your attitude towards money should help you to maintain a good credit score and keep your debts to a minimum.
  Implementing any or all of these suggestions will start you on the road to credit score recovery. It won't always be an easy journey, but it will be so worth it when you no longer have to worry about repo agents, phone calls from creditors, or best of all being turned down for essential lines of credit like mortgages, in the future. Your financial future really is n your own hands; you just have to take the first step to see big changes.