How to Rebuild Your Credit Score
A low income hampers your ability to be in control of your finances. Budgeting for what you have earned as well as having an impressive credit ranking will help greatly in bringing sanity to your financial world.
As far as credit rankings are concerned, it is quite easy to harm your ability to borrow. Most people have no idea how much they frequently put in jeopardy their credit ratings. They should work towards avoiding such risks. The circumstances of a few individuals are unfortunately presently terrible. You also need to ask yourself how long it will take to rebuild your credit score. This duration is dependent mostly on the extent of the damage.
The first step to take would be to open a bank account. You are required to have this provision when you commence your rebuilding journey. You may not have a lot of money to deposit in that account, but when assessors are looking into your already poor situation, lack of an account is detrimental to your fate. Having good ones with no liabilities on them is desirable.
You then need to start the process of settling debts you have on your credit. Reporting that you are bankrupt causes your debts to be written off. If, however you are simply in a bad financial situation, then it is important to begin clearing those debts on your accounts. It is better for you to strive to pay some o the debts in one go, as this will earn you big discounts on them. Once you are at a stage where you have either cleared them or are regularly paying their installments, you can now begin actively promoting your credit score.
Work towards keeping the regular installments on time. This will minimize chances of you loosing your advantage in the struggle. The debt collectors have a duty to report on any default payments, as well as your pattern of making payments. You want your report to remain positive.
The next step is to get a credit card. A a secured card is the only viable option when your rating is poor. They are issued once you have some collateral either at your bank account or a deposit towards the same. Responsible use of the card, with regular and up to date repayments, will impact positively on your credit score. People fear credit at this juncture, but they are advised to have a little of it and be prompt with payments, which will better their score.
When you get here, arrange to have a small loan. To improve your score, you shall have to maintain your regular payments. The best to go about it is to request for a small loan, then pay for it on time.
You can also go further and request a friend to authorize you to be in charge of one of their lines of credit. Accounts with good credit scores will help out your case, when they are reported under your name.