How to Get Back on Track with Credit

 

 

If you have had problems in the past paying your bills, your credit history has been affected. With this in mind, it may be difficult to obtain future credit. The following suggestions will help you re-establish your credit:

 

Use a savings account as collateral for an installment loan. You may be able to borrow as much as you have in the account, but your prompt repayment will indicate responsibility.

 

Make a larger down payment than required to indicate an interest in the purchase. A creditor will approve a loan where you have something invested.

 

Have a cosigner who has not had credit problems apply with you for a charge account or loan.

 

Have merchandise financed through a dealer or store where there is collateral for the item.

 

Discuss getting a credit card with a minimal credit limit from a major department store until you can prove your credit worthiness.

 

Avoid rent-to-own companies that advertise re-establishment of credit by renting merchandise. It is not uncommon for the required weekly payments to increase the cost of the merchandise 2 or 3 times its normal value. Not only that, but most rent-to-own companies do not report your credit status to credit bureaus because they are not subscribing members.

 

According to the Fair Credit Reporting Act, you have the right to attach a 100-word statement to your credit report. If the circumstances behind your problems are unusual, it may be helpful to have the added clarification available for potential lenders.