Do it yourself Credit Repair
You found yourself in a very bad financial situation. You may feel emotional, hopeless, guilty or all of them. You are afraid of hitting rock bottom. Before that happens, you need to take the necessary steps to get your financial life in order. You need to look long and hard at your credit use and spending habits. It doesn't mean a "debt consolidation," program or a home equity loan .The word is PLAN.
Round up all credit reports, bill payment and credit card records, loan and mortgage records. You can find debt worksheets on line that will assist with making your plan. Most likely sections of your planning will be occurring at the same time.
Be meticulous about ensuring that your credit reports (there are 3 major credit reporting agencies) are accurate and truly reflect your credit status. To complete this project may take some written communications with one or all of the credit reporting agencies. Stay with the process.
Record in black and white all of your financial obligations. This will affect the money management part of the plan. Do list all credit cards in order of highest to lowest interest rates. Also include the monthly minimum payment required for each card.
After this, you are going to look at the picture of "disposable income" and "discretionary income." What are these? You have a certain amount of your salary that pays for your necessary expenses such as loans, utilities, mortgages, insurances, and credit cards. This is disposable income. Subtract the total from salary and this is discretionary income which is the amount you have to assign to reducing debt.
Determine which credit cards and loans you can pay down in order. For the first on the list, pay as much over minimum as possible. Pay minimum on the others. When the first is completed, apply that payment to the next in line and so on. This will be an ongoing money management strategy for a long time.
There will be some personal discomfort as you tackle this project. There will need to be changes in your lifestyle. You will need to cease purchasing that is not essential. You will need to stop charging, pay bills on time, minimize travel and entertainment, dine more at home and perhaps give up other indulgences.
The bottom line of the situation is that you are responsible for creating it. There is no credit angel. You need to fix it and use smart money management techniques to maintain your repairs.
Round up all credit reports, bill payment and credit card records, loan and mortgage records. You can find debt worksheets on line that will assist with making your plan. Most likely sections of your planning will be occurring at the same time.
Be meticulous about ensuring that your credit reports (there are 3 major credit reporting agencies) are accurate and truly reflect your credit status. To complete this project may take some written communications with one or all of the credit reporting agencies. Stay with the process.
Record in black and white all of your financial obligations. This will affect the money management part of the plan. Do list all credit cards in order of highest to lowest interest rates. Also include the monthly minimum payment required for each card.
After this, you are going to look at the picture of "disposable income" and "discretionary income." What are these? You have a certain amount of your salary that pays for your necessary expenses such as loans, utilities, mortgages, insurances, and credit cards. This is disposable income. Subtract the total from salary and this is discretionary income which is the amount you have to assign to reducing debt.
Determine which credit cards and loans you can pay down in order. For the first on the list, pay as much over minimum as possible. Pay minimum on the others. When the first is completed, apply that payment to the next in line and so on. This will be an ongoing money management strategy for a long time.
There will be some personal discomfort as you tackle this project. There will need to be changes in your lifestyle. You will need to cease purchasing that is not essential. You will need to stop charging, pay bills on time, minimize travel and entertainment, dine more at home and perhaps give up other indulgences.
The bottom line of the situation is that you are responsible for creating it. There is no credit angel. You need to fix it and use smart money management techniques to maintain your repairs.
About the Author:
With unprecedented challenges in the credit markets it?s more important than ever to have excellent credit. For more information check out Rob Kosbergs' Detailed FREE Guide on Maintaining and Repairing your Credit Score by going to Bad Credit Repair for your FREE information.
posted by Credit Counseling at
1:23 AM
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