| There are two major ways to fix bad credit report. | | | | calculated from your current card balance (revolving |
| The "hard" way requires time, patience, effort and | | | | credit). When you stop paying "as agreed", you are |
| careful financial planning. The SMART way requires | | | | violating the contract. By far payment history is the |
| better knowledge of the credit system and its | | | | single most important factor in your FICO formula. If |
| loopholes. Here is a 4 step guide that will help you raise | | | | you do have late car, mortgage or credit card |
| your score in no time: | | | | payments, take care of them first. This should bring an |
| 1 Don't play the credit game blindfolded. | | | | immediate increase in your credit score. |
| Most credit consolidating places will charge you an arm | | | | 3 The collection agency paradox. |
| and a leg for thing you can do yourself if you have the | | | | Old collection are a tricky area when it comes to your |
| right information. Do you know how is the credit score | | | | FICO score. Paying off an old collection will not |
| calculated? Do you know what are the most | | | | increase your credit score. On the contrary, it might |
| detrimental items on your credit report? Why does | | | | bring it down. Paying off the collection simply upgrades |
| paying off old collections can bring your score down? | | | | the account to "paid' status. It is still a negative item on |
| What is the perfect debt to balance ratio on your | | | | your report, albeit paid. Only now it has bigger influence |
| credit cards? Is installment credit(auto loans, house | | | | on your score, because the last activity on the |
| loans, student loans) or revolving credit (major credit | | | | account is more recent. |
| cards, department store cards) more important for | | | | 4 The time factor. |
| your final FICO score? How can piggybacking | | | | In general the older an item on your credit report, the |
| someone else's credit increase you score? Why do | | | | less effect it has on the overall FICO score. And vice |
| "deleted" negative items from your report are far | | | | versa-most recent payment history has the biggest |
| more beneficial that "paid off" negative items? The | | | | impact on your score. Focusing on what's current will |
| more you know about the credit system, the easier it | | | | bring the most drastic changes to your credit score. |
| would be to choose the right course of action. | | | | Paying off old accounts might have the negative |
| 2 The most important rule in the credit world | | | | effect described in the example above. |
| The credit world revolves around one magic phrase | | | | Educate yourself on the mechanics of the credit |
| "ON TIME". Creditors expect you to pay off your loan | | | | system if you want to fix bad credit report. There are |
| in accordance with the terms and conditions of the | | | | many secrets that can boost your score fast, but you |
| contract. You are required to pay one fixed monthly | | | | have to start thinking outside the box first. |
| payment (installment credit) and one minimum payment | | | | |