If you notice a sudden drop in your credit rating, the first thing you need to do is to ensure that the information depicted on the report is correct. If indeed the information is correct and your rating is still low, you can start working towards improving it. Remember a low credit score will impact on your ability to get credit from financial institutions.
Let’s start with the different forms of credit repair Toronto that you can start implementing from today.
Once you and the credit counselor have identified the areas of challenge, the next step would be to choose a suitable debt consolidation loan to repay your creditors. We can contact the creditors and negotiate for a full payment and waiver of penalties and late payment fees. A lot of creditors will agree to full payment of outstanding loans given that the debtor has financial challenges and has not been able to make the monthly payments. The full amount that you need to be pay to all the creditors together is what you need to take out in the debt consolidation loan.
When choosing a suitable debt consolidation loan, we aim to find a loan with low interest rates affordable monthly payments based on your current income and a suitable long time. In some situations when your credit is good, you can apply for a 0% interest rate credit card to pay off unsecured loans. This is really advisable when the outstanding loan amount is small.
However if you have a huge debt, personal loan would be most suitable to use for debt consolidation. The personal loan allows you to pay your debt over time. We will calculate the personal loan monthly payment rate according to your income and therefore it should be an amount that you are able to comfortably pay at the end of the month. Additionally the personal loan that you take may improve your credit score by moving the bad credit card debt to the installment loan column.
Our Mississauga debt relief specialist will work closely with you to find the right debt consolidation loan. At this point you will need to create a budget plan that you’ll use over the next couple of months or years in order to finance these payments. The budget plan will guide how you spend your monthly income allowing you to make savings repay the personal loan and meet your expenditure needs.
First, make it a point to pay all bills on time. Late payments have a negative impact on your score regardless of the type of bill it is. Whether it’s a credit card payment, utilities or student loan, make sure you pay them on time. If you are unable to make timely payments, discuss with the creditor on how adjustments can be made to help you in the repayment process. This could mean reducing the monthly payment or adjusting the date when the debt is credited from your account. Just do what it takes to help you pay up your debts on time.
Pay bills in full. It’s one thing to pay your bills on the due date but it’s another to ensure you’ve paid the correct amount. Full payments have a positive impact on your credit rating. If there is a minimum amount that you must pay, make sure you don’t make a payment that is lower than that because this will depict in your credit card report.
Pay your bills as fast as possible. When you are in debt for longer than what is expected, it has a negative impact on your credit score. You may want to consider different ways such as debt consolidation that can help you to pay your debts as quickly as possible. The longer you are in debt, the less likely you are to receive credit from other financial institutions and the lower your credit score.
If you use credit cards, make sure you never exceed your credit limit. Exceeding your credit card limit has a negative impact on your credit score. Make sure the balance is lower than your limit, if possible at least 40% of the limit should remain every month.
Did you know that applying for credit can have a negative impact on your credit score? It doesn’t matter whether the credit application was successful, it can still reflect on your credit report. This happens because too many lenders are asking about your credit within a short period of time. Even though this doesn’t directly lower your score, it could be an indication of your inability to sustain yourself financially and hence the reason to seek multiple credit sources.
Use your credit card in order to gain a credit history. Some individuals have a low credit rating simply because they do not have a record of having credit or paying it back on time. This lack of credit history can also have a lower impact on your score.