Five Steps To Repair Credit

Tough times can happen to anyone. Challenging life events like job loss, reduced income, high medical bills and unexpected expenses can put a strain on finances. If your credit is in rough shape, don’t give up hope. By taking these steps, you can begin to repair your credit.

Review Your Credit Report

Look at your credit reports from the three major credit reporting bureaus (TransUnion, Equifax and Experian) to verify that everything is accurate. You are entitled to a free copy of your credit report from each of them once a year through annualcreditreport.com. Make sure there aren’t mistakes that are dragging your score down. Dispute any incorrect or missing information with the respective credit reporting agency.

Take Care of Past Due Accounts

Your payment history is the most heavily weighted factor in your credit score. The sooner you make payments in full, the better. A payment that is 30 days late won’t ding your score as much as one that is 60 or 120 days late. Get a handle on overdue debts before they are charged off and sent to collections because collections accounts can stay on your credit report for up to seven years.

Pay on Time

One of the best things you can do for your credit score is to pay your bills on time. Life can get busy and sometimes it can be hard to keep track of each bill’s due date. Consider setting up recurring payments through Bill Pay in Landmark’s Online Banking. That way payments will be automatically deducted from your checking account to ensure they are paid on time.

Keep Your Balances Low

Your credit utilization is calculated by dividing your balances by your total credit limit. Try to get your balance under 30% to demonstrate that you are managing your credit well and able to pay off your debt. For example, if your credit limit is $10,000, you should strive to keep your balance below $3,000.

Consider Keeping Cards Open

Closing a credit card might hurt your score by decreasing the length of your credit history. Even if you aren’t actively using a card, provided it has no annual fee, keeping the card open will extend the average age of your accounts.

Although there is no quick fix for repairing your credit, by diligently following these steps you can begin to improve your credit score over time. As you build a better credit score, you will have more opportunities to qualify for loans, enjoy lower insurance rates and more. At Landmark, we’re always here to meet your everyday financial needs and long-term financial goals. We’re happy to help you explore our products and services that might suit your needs on your path to improving your credit.