With all the enticing credit card offers flying around and loan approvals here and there, working on a credit rating should be consistently worked on. Having a good credit rating could lead you to that dream house you’ve been praying for, or get you that dream car of yours, hence it should be taken as a priority. Also, lower interests and better terms await someone who has a better credit rating.

Unfortunately, though, people only tend to review their credit rating when it already matters. And if you have bad credit loans floating around, or don’t have the right rating at all when you need it the most, working to improve it is not an overnight task.

Read on below as this article will cover seven common mistakes which should be avoided, but people tend to do when repairing their credit rating.

1. Getting in touch directly with the debt collectors :

Receiving communications via phone from debt collectors can really be stressful and most of the time feel harassing as well. If you’re getting irritated with debt collection calls is to ask them to send everything in writing via post. With something tangible in your hand, you can then review the details and correct what needs to be corrected.

2. Agreeing to anything that’s not written :

In relation to communicating via email or snail mail, make sure not to make any arrangements with the debt collector over the phone. Think of the other person you’re talking to on the other line as a robot who has to do what’s been told for them to do. Getting your agreements in writing will make it easy to confirm your arrangements.

3. Closing any credit card accounts :

This is one of the misconceptions people tend to do when working on their credit scores. Although it may seem rational that zeroing an account you once owed and closing it down could lift your credit rating up, you got it wrong. One of the things that creditors look at when doing credit rating checks is the history of the account, meaning how long an account holder owns a certain account especially a credit card. Hence, closing it down and opening a new one doesn’t really help.

However, clearing your current credit card account from late fees and making sure the payment is up to date while it’s active is the wise thing to do when working on your credit rating.

4. Applying for a major credit card :

Obviously, having a not-so-good credit rating doesn’t let you apply for a major credit card offer. So stop wasting your time and energy in sending inquiries thru their website as it gets recorded. The more times you get declined, the more it reflects straight to your credit rating score.

5. Not paying your debt quickly and on time :

If you already have an active credit card at hand, start by removing late payments on it and make sure to make it current. Avoid maxing it out and just build your good history on the account you already have. Next is, check the other loans you have active, and slowly pay the debts off. Ensuring you do this in the next 6 months, then 12 months is a good jumpstart.

6. Not getting back into debt :

It is understandable that after being in a big hole of debt, next thing you’ll think about is to not get back into that same situation again. However, that is a big misconception too. Be sensitive about how credit rating companies look at how you deal with debts. Do you pay on time? Do you pay the full amount? Do you always max out your credit card? Those are the things they will look at. If you close your credit card and avoid getting any loans in the future, then it becomes close to impossible to amend your credit score.

7. Not Getting a Secured Card :

A secured card requires a collateral deposit. If you really have a low credit score and no other credit card company would like to lend you one, then this is the kind of card that’s right for you. This helps you control your spending as you only get to spend a minimal amount. It then gives you the opportunity to build your credit rating up by allowing you to use the available credits and at the same time teaching you discipline.

Building your credit rating up again is not an overnight task – it takes time. But as long as you’ve got the patience and the right state of mind, for sure you’ll make it through. So don’t just wait for a bank to call you and offer you something you can use, make use of what’s readily available for you and start working on repairing your credit score NOW – before you really need it.

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I enjoy writing and I write quality guest posts on topics of my interest and passion. I have been doing this since my college days. My special interests are in personal finance, investing, insurance, loan etc.