How To Rebuild Bad Credit

Sometimes it seems as though if you go through a tough period in your time, at least in the eyes of the credit card companies, you are toast. It seems almost impossible to get a new credit card. The problem is multiple things, one of the biggest of which is that there are three major credit bureaus that blatantly advertise the fact that you fell behind on your payments a few years back. Your credit report from these credit bureaus holds you back from rebuilding the credit you need.

But there are ways around this. It does not happen overnight though, and is going to take some work on your part. Despite a number of companies out there, both online and offline, that claims it CAN happen overnight, believe me, it cannot, and any company who says that it can is probably running their company from behind bars somewhere.

This is a multiple step process but with some focus on your part, it is entirely possible to get a poor credit rating turned into a good one in a relatively short period of time. The big benefit of doing this the right way is that it is entirely honest, legal, and ethical, and will therefore stay in place for years to come, assuming of course that you meet your new credit obligations in a timely manner.

First of all, you can get a prepaid credit card. These still have a Mastercard or Visa logo, but your credit limit is exactly how much you have on deposit with the lender. If you put $500 on deposit with the lender, then your credit limit is $500. If you can only afford $200, then it’s $200. The size of the deposit and your credit limit is not significant. What IS significant is that you use this card, you never exceed your credit limit, and you always pay at least the minimum amount due every month, on time. This is one of the best things you can do to rebuild a bad credit situation.

In fact, you can get multiple of these cards and get on a faster track to rebuilding your credit. Make sure that the prepaid credit card that you get does report to at least one of the three credit bureaus, and if they report to more than one, then so much the better. What you are going to be doing is making sure that a very positive report of your credit goes into your credit files each month.

The thing you can do at the same time is to contact each of the three major credit bureaus, which are Experian, Equifax, and TransUnion, and get a copy of your credit report from each one. It is critical that you get a separate copy from each one because they do not share information, and it is more than likely that they each have different information about you and your credit history. When you get the reports, go over them with a fine tooth comb and look for things that are not right. Current reports indicate that you are likely to find multiple inaccuracies. When you do, then you need to dispute that item with the credit bureau and get it corrected. It is the credit bureau’s responsibility to either verify the information as accurate, or to change it or delete it. This process will improve your credit score and not make it look worse than it needs to. For more information about this, you may wish to visit Raise Your Credit Score.

Remember, your credit rating did not go down the tubes overnight, and will not come back overnight either. It takes time and patience, but hopefully you have learned some things about credit during your tough times, so now is the time to rebuild your credit to the point where it needs to be so you can function in today’s fast-paced society.

How to Rebuild Your Credit Using Services of Subprime Lenders and Payday Loan Companies?

A lot of people can find themselves in a very difficult situation simply because they made some financial mistakes in the past. A lot of prime financial institutions require you to have high credit score and spotless credit file to be eligible for low interest lines of credit or even for a credit card. But what about consumers that made bad financial decisions, overextended their ability to pay back their creditors and had to file for bankruptcy? Even if you had to go through credit counselling services and paid back your debts, but did not fulfill your contractual obligations with your creditors, you credit worthiness is ruined.

If you’ve gone through a bankruptcy and credit counselling program, you will have to rebuild your credit before any kind of credit will be extended to you. Rebuilding your credit can be a lengthy process and requires time and patience. First thing that you should do is to obtain your credit file from main credit reporting agencies. There are two main credit reporting agencies which are: Equifax and Trans Union. Obtaining your credit report is not a very difficult procedure and can be done instantly online for a fee between $15-$40 dollars or free of charge by mail. In order to obtain you credit report by mail you will need to fill out an application form (that can be downloaded from and and attach 2 pieces of id and a utility bill. You can either mail or fax your application to credit bureaus. It usually takes 7-10 business days to receive a copy of your credit file by mail. Once you get a copy of your credit file you should look for any discrepancies. If you declared bankruptcy and were discharged, all former creditors have to stop reporting to the credit bureaus after the discharge date.

The same should happen to any collection items if any have been reported on your credit file. If you find any discrepancies you can download and fill out a dispute form from and and submit it to the credit bureaus. Credit bureaus have to investigate your dispute and make appropriate corrections in your credit profile. Once all the discrepancies are eliminated, you will have to wait some time before all previous activity is removed from your credit file so you can start rebuilding your credit from scratch. If you went through a credit counselling program, it will take about 4 years after your program is completed for all the R7 accounts to be removed from your file. If you filed for bankruptcy it might take up to 10 years for the bankruptcy to be dropped from your credit file.

Once your bankruptcy has been discharged you should get a secured credit card and make your monthly payments on time. After a year or two you bank might release you security deposit. However for the next 7-10 years you will not qualify for car loans, mortgages or lines of credit with prime financial institutions and will have to use services of subprime lenders. If you need quick cash advance (up to $1000) to pay an unexpected expense you can apply for a Payday loans are short term loans that are available to consumers in cases of emergency and at times when there are no other financial options available. Those type of lenders have high interest rates but if you do not have perfect credit rating you can still qualify for a loan with them. Some subprime lender report your timely loan payments to Credit Bureaus and some not (payday loans companies do not usually report to credit bureaus). You should double check with lenders before you apply for a loan. It is better to get financing trough a lender that will report your timely payments to the Credit Bureau as it will positively impact your credit score. Do not apply for a loan with numerous institutions at the same time. Numerous inquiries on your credit file will alert lenders and will lower you credit rating even more. Everything has a price and you will be paying for your past mistakes by having to pay high interest rates.