Zum Inhalt springen

Best Finance Network
Get the best connectivity about finance.

How I succeeded in increasing my credit score

There are many rewards to leading a lavish life. However, there is a price we have to pay for leading such a life. I realized much later that debts had kept on piling and now there was a huge mound of debt that I was to pay off. This had affected my credit score so drastically that I could not even get credit at favorable terms and conditions. I then became determined to improve my credit score by trying every means possible. It was at that time when a friend suggested that I should go for consumer credit counseling . I also realized that I had 3 outstanding credit card debts and a total amount of $25,000 on 3 cards. To improve my credit record I decided to pay off these cards

I want to share what I did to repair my bad credit record, so that you may draw something out of my experiences if you are in a similar situation.

1. Ordered for my credit report: It was very important for me to improve my credit score that had gone down drastically. So I ordered for my credit reports from all the three major bureaus- Experian, Equifax, TransUnion. I reviewed all three of my credit reports thoroughly to check if there was any inaccurate information.

2. Disputed the inaccuracies: I realized that one of the debts that was charged to my account was not mine. After carefully going through my credit report I also noticed that a debt that I had already paid was still appearing as outstanding in my credit report. I disputed these inaccuracies in my report and was successful in getting them removed from my credit report. This helped me in improving my credit score.

3. Budget formulation: A counselor from the consumer credit counseling agency helped me formulate a budget. This provided me with a clear idea of what my income was and where was I spending it. The budget helped me realize that I was earning enough to live a decent life but it was not enough to indulge in luxuries or to pay off the debts that I presently had. Thus, I adjusted my spending as per the situation.

3. Credit card consolidation: I had to pay off the 3 credit card debts if I was ever to improve my financial situation. As my financial position permitted me to make at least some payments, so I opted for credit card debt consolidation. The total amount of debt after the disputed amount was removed came up to $25,000. The minimum payments that I was making towards my bill were as follows.

Minimum payment on the first card with debt $7,000, at 11% was $770
Minimum payment on the second card with debt $8,000 at 15% was $1200
Minimum payment on the third card with debt $10,000 at 12% was $1200

Thus, my total minimum monthly payment came up to $3170. The debt consolidation company got my interests reduced and after the reduction I had to pay $2000 every month to the company, this included the professional fees as well. I had to pay much lesser than what I was supposed to pay originally and my late fees were also waived off.

I have managed to pay off my debt and also succeeded in improving my credit score by several points. I would advise everyone to check their credit reports and increase their score (if required) before applying for a loan.

« Consolidate your commitments with Debt Consolidation – Business Funding – Overdrafts and Factoring »

February 22, 2011 um 10:08 am
Trackback URI

1 Comment »

No comments yet.

Kommentar-RSS: RSS feed for comments on this post.

Leave a comment