A cure for an ailing credit
|
James Taylor
[SATURDAY ,MAY14, 2005, 01:04:25 PM]
Credit has become a much-used word,
thanks to the various connotations that it is being
used in. Transactions in which the payment is deferred
to the near future are termed as credit transactions.
Ever thought why the grocer sells
goods on deferred payment- because of a good credit
that you enjoy. Credit is the reputation or standing
that a person has in the society. Though credit includes
various non-financial aspects, our study primarily
includes the financial aspect.
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The lending community watches every
financial transaction of the person in question with
its hawkish sight, and classifies the cases from excellent
to worst. One cannot be sure of staying on a particular credit rating for a long time, owing to the
volatile nature of the credit reports.
A single instance of default or
late payment can tarnish the credit for a long time.
Having contracted bad credit once, you would
always find yourself facing the same situation, unless
some serious efforts are taken to get out of the muck.
Do you think that the issue is
insignificant to your case? Think again. Checking
with your counterpart having a good credit rating
will reveal the higher rate of interest being charged
by you. The reason for this extra charge is a bad
credit tag that accompanies your credit report. It
will be much easier for a person with good credit
to get a loan than for a person with bad credit.
These and many more reasons make credit repair a priority.
First
check the credit report. Every person who has ever indulged in
credit transactions will have a credit report prepared by the
credit reference agencies. A person can apply for a credit report
within 60 days of receiving the bad credit notice. Make a note
of any discrepancies in the credit report. There are many debts
that you have not incurred but are present in the credit report.
Many trivial matters like divorces, lawsuits etc affect credit.
It will thus be important to see that even the smaller discrepancies
are not overlooked. Credit report must be regularly checked to
fix such small discrepancies within time. This will also help
trace identity theft on your account. These must be fixed immediately.
The paragraph above dealt with entries in the
credit report not conforming to the person. Next, we deal with
the case when there actually is a debt that has not been paid.
The debt must be paid up as quickly as possible. Delay beyond
a month will make payment inconsequential because the credit reports
will incorporate the defaults, thus making the bad credit irreversible
for a period of about six years.
Credit counseling will be beneficial for people
who are not much aware of the various options available to them.
Various credit-counseling agencies are available on the net and
on phone. They even conduct personal meetings with the clients.
After having a chat on the problem being faced by the client,
they suggest viable solutions. However, the client can refuse
using the solution if they do not find it useful.
Prevention is better than cure. Certain steps
may be taken to prevent credit rating from worsening. Only a few
loans must be taken. The number of debts will vary with the income
capacity of every individual. Regularity in payments will also
have a positive impact on the credit rating. A considerable time
gap must be maintained between any two loans . Having
too many loans with a shorter repayment period can have serious
repercussions for the finances. This too will affect the credit
rating.
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HERE FOR A CREDIT LOAN
These will not clean up the credit report altogether,
but will at least help to make a small dent in the bad credit
history. With a concerted effort over a period of time, the credit
history will transform.
Summary
Bad credit has serious repercussions for the
individuals. They are refused loans by most of the lenders. This
article explains the various methods to repair the credit history.
It also gives tips have been provided to keep the credit rating
from falling.
James Taylor holds a Master’s degree in Commerce from JNU. He is working as financial consultant for Chance For
Loans. To find debt consolidation loans, debt consolidation loans, cheap rates, personal loans, secured loans, unsecured
loans, improvement loans http://www.
