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Repairing Bad Credit Reports

By Ruth Racey
Published: Sunday, September 20th, 2009

A credit report is essentially one of the ultimate basis used by credit card companies and lenders. By reviewing a potential client’s credit history, a firm can assess the financial capability of the applicant to make payments. Conversely, bad credit reports can ruin the chances of a consumer trying to get credit, mortgage, or even car loans.

Fortunately, there are several measures that Americans with poor credit histories can do to remedy their problems. By simply following these easy suggestions, people with less than perfect credit reports can achieve their goals of getting credit, loans, as well as other benefits.

Repairing a bad credit report means analyzing and scrutinizing every entry in the report. Sometimes, the credit bureaus that issue the reports make mistakes. These errors can often lead to potential card issuers and lenders getting negative impressions about a particular consumer.

In most cases, updating the information seen in the report can help fix the problem. Most lenders and banks are more than willing to consider extending services to consumers who have stable jobs. Federal law allows consumers to add relevant information to their reports to repair them. Important data like newly acquired jobs and stable employment can sway card issuers and lending companies to the consumers’ side. Even records of prompt and punctual tax payments can help make things better for the consumer. Basically, anything that shows that a cardholder can settle his or her dues can be a sign of financial responsibility.

Another commonly used technique is the goodwill intervention. This particular practice involves dealing with companies consumers owe debts to. Of course, this particular method is only suitable for people who intend to pay their dues but lack the time and opportunity to do so. Most often, deals can be made between the consumer and the companies. These deals would often spell out negotiated terms of payments to ease the burden of paying off debts for consumers. The great thing about goodwill interventions is that this practice will not reflect negatively on a credit report.

For some Americans, the best way to avoid bad credit reports is to get rid of unused cards. This, however, is the total opposite. Disposing a credit card would also mean getting rid of all the credit history a consumer has had with it. This would be unfavorable to the cardholder especially if the disposed card had given the consumer a good credit record. On the contrary, cardholders should keep cards that they can maintain.

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