Reestablishing Your Credit

Reestablishing Your Credit & Debt Consolidation

If reestablish credit debt consolidation is on your primary to-do list, you are not alone. Like hundreds of thousand, you may be a credit card abuser pulling out your cards too often for impulse purchases. The struggles to limit this kind of impulse are huge. But too few pay off their monthly balance turning a useful tool into financial havoc.

It is vital that you pay closer attention on how you use your credit cards in order to successfully manage your money. To some this is obvious, but unfortunately, many do not understand how good credit can positively impact their lives while bad credit can severely destroy their dreams.

Good credit is a measure of your trustworthiness. By being able to pay your bills on time you are seen as a good credit risk because lenders trust that you will also pay your loan back on time. Also, having a good credit rating is beneficial in acquiring lower interest rates, higher credit limits and greater ease when trying to borrow money.

Bad credit, on the other hand, can take much longer to repair than it did to create. Case in point: it can take up to seven years for negative information to be removed from a bad credit report!

To reestablish credit debt consolidation you can find debt help online and off. Starting with the listings on this page is a good start. In most cases, you can get reestablish credit debt consolidation quotes for free and with no obligation. This is great because you can compare and then choose the best offers available. But be aware, however, that there are some less reputable debt agencies that will send you even deeper into debt if you don’t check out your options carefully.

To reestablish credit, credit repair services put all of your debt together into a lump sum monthly payment which is then distributed to your creditors. A benefit of debt consolidating is that your credit repair center works with your creditors and gets rid of those constant phone calls and collection letters. The credit repair service you choose can also help decrease the interest or penalties that you’re paying on old credit card debt.

If you are stuck with bad credit report and can still obtain a credit card, you might find that you will be paying much higher interest rates. Some cards charge a large balance to your new card before you have even used it and call such fees “set up fees.” You may also pay annual fees as well.

There are also secured credit cards which offer another way to reestablish good credit. This is where you put down or secure a certain line of credit with your own money. For example, if you wanted a thousand dollar limit on your credit card, you would secure the card by paying a thousand dollars which is then held at whatever financial institution you’re doing business with. The available balance is the amount you have secured. By making payments on time, the credit card company may release the security you put on your card and thus give you unsecured status.

When possible, avoid payday loan companies – the interest rates are often huge and you could find yourself caught in a vicious cycle of only paying down the interest.

It is also important to know your rights. Read the fair debt collection practice act. This act offers consumers a thirty day grace period in which you can dispute a debt. There are sections under the law that will help you prevent collection abuse or harassment. You should also learn about statutes of limitations when a debt expires as well. Collection companies can no longer request payment on that particular account. Many statutes of limitations are for debts four to seven years past their default date. Each state has its own laws on limitation statutes.