Tips To Rebuild Your Credit

If you suspect or have been told you need to rebuild your credit, be assured that improved credit is within your reach. Over the years, Countrywide Bank’s Full Spectrum Lending Division has educated thousands of people about credit and mortgage money management. Even if you've been told in the past that you have bad credit, there's no reason why you shouldn't be able to rebuild your credit, perhaps even qualifying for a prime loan. We're eager for the opportunity to help you put your financial difficulties behind you.

Check out these tips to improve your credit score:

Check Your Personal Credit Record

Even people who don't think they have credit problems are sometimes surprised when they find mistakes in their credit report. Yet mistakes can happen and it is up to you to identify and report them to the credit reporting agency. All U.S. residents can receive one free credit report annually from each of the three major U.S. credit reporting agencies- Equifax, Experian and TransUnion, thanks to the Fair and Accurate Credit Transactions Act (FACT Act).

There are three ways to order your free report. You can order online at www.annualcreditreport.com, call 1-877-322-8228, or complete the form in the Annual Credit Report Request brochure and send it to the following address: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

Another way you can receive a free report is if you have been turned down for a loan, job, insurance policy, credit card due to a negative credit report. The credit bureau that issues the report is required to send you a copy of the report so you can check for errors.

If there is a mistake in your report, write to the credit agency and lender involved, and include any supporting documentation you may have. Send any written communication via certified mail to ensure you are able to prove that the credit reporting agency received your request. Once the agency has received your complaint, it is obligated to investigate your claim. Follow-up until the correct information is reflected on your credit report.

Start Saving

If you don't have one already, open a savings account and start paying yourself first! Saving 5-10% of your income monthly is a habit that could prevent you from having to rebuild your credit again in the future. If you have spare funds, the chances of missing a payment become far less. Even if you have unforeseen expenses during a month, you won't be caught off-guard if you have some savings. Credit reporting agencies look at how responsibly you repay your debts, so checking and savings accounts with some money in them – as opposed to maxed out credit cards - will look good and help you in rebuilding credit.

Live Within Your Means

If you don't have any money left at the end of each month, it's time to stop spending! Nothing rebuilds credit quite like creating a budget and living within your means. Part of rebuilding your credit is separating your family's wants from its needs—and going without some of the "wants" in order to take care of the "needs." If you adopt this thinking, you're far less likely to have problems that can lead to being labeled as having bad credit. And it'll go a long way to improving your current credit score!

Use Credit Cards Responsibly

Responsibly using a credit card, keeping up with regular payments – and no unpaid bills – for continued periods will translate into an improved credit score. The longer you maintain good, responsible behavior with the credit available to you, the better your credit history will look.

Pay Your Bills On Time

Paying your bills regularly and on time is critical to rebuilding credit – especially if you've had less than perfect credit in the past. Many people underestimate the impact that even one late payment can have on their credit scores.

Avoid High-Interest Quick Credit

Be careful about getting yourself into more debt by opening quick access credit accounts with high interest rates. Rebuilding credit starts with keeping your debts at a manageable level and in reasonably-priced accounts.

These tips to improve your credit score can help make it easier for you to qualify for a home loan at a lower interest rate. Even a decrease of a few tenths of a percent in an interest rate can mean thousands of dollars over the life of a 15 or 30 year loan. So, if you've been told you have "bad credit," don't let another lender's lack of flexibility or inability to offer a full spectrum of loan options rob you of hope. At Countrywide, we specialize in helping qualified borrowers secure prime loans, whenever possible. Call us today at 1-800-909-8217.