Understanding Poor Credit Debt Consolidation
April 26th, 2009 | 
Author: Most everyone has some kind of debt. Having debt is fine, as long as you can keep up with the payments. However, if you canít keep up and miss several payments in a row, youíre credit score is going to be effected. If you have a bad credit rating, banks and lending institutions will consider you to be a high risk prospect. This would mean higher interest rates, more stringent requirements, or even ineligibility for loans.
Improve Your Credit Rating with Debt Consolidation and Credit Repair
If you find yourself in such a situation, don’t despair. But first, you need to accept that you need some help fixing your debt problems and learning from your mistakes. You can improve your credit standing by following four simple steps to credit repair debt consolidation. Rapidly raising your credit score should be your immediate goal. Following the credit repair debt consolidation steps below will help you increase your credit score in just one year.
First – Get Your Credit Report
There are three credit reporting agencies ñ Equifax, Experian, and Transunion. You can get a free credit report from each once a year. You can monitor your credit for free throughout the year by requesting a free copy from one of the agencies every four months.
When you get your credit report, go through it with a fine tooth comb. Write in to challenge anything that seems inaccurate. The false record will be removed from your credit report, increasing your credit score, if there is no response from your creditor within 30 days. This first step is essential to your poor credit debt consolidation process.
Second ñ Prioritize Your Debts
The purpose of credit repair debt consolidation is to clear off your debts. So, now list out all of your debts with the ones that give you the biggest headaches first. For example, most loans charge you 18% interest per annum, while your credit cards typically charge you 3% compounded interest per month. In this case, it makes more sense to pay down your credit cards before your loans, because your credit cards are impacting your credit score. Pay off the minimum monthly dues for all loans, but pay extra for the highest interest loans, to finish them off first.
3. Try to Make Payments Early
Not missing payment due dates is very important to you credit rating. Youíll need to make payments on time for an entire year to correct any damage youíve done to your credit report by missing payments in the past.
Step 4: Get a Secured Credit Card
Having a secured credit card can help your credit repair debt consolidation and increase your credit score.
Commit yourself to these fours straightforward, simple steps and before you know it, you will be living free of bad debt again. If you want it badly enough to work for it, it will work.
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