I never realized the effects of living with bad credit until I tried to buy my first home. It was at that moment that reality washed over me. It is that moment that forced me to learn everything there is to know about the repair process. It was that moment that motivated me to start teaching the people of the United States how to master the process themselves. Now I am going to share with you some of those same strategies so that you can enjoy the purchasing power that you deserve.
Forget all the talk that all the experts have told you, the truth is that the process of rebuilding credit is not complicated. I will give you exactly the same advice that I give my students. Start at the root of the process, which is your credit score. You must first understand the work of your punctuation. This number gives lenders a bird’s eye view of the positive and negative aspects of your credit report. Most of the credit rebuilding systems you find on the market today only focus on the negative aspects of the process and totally neglect the positive aspects. Even if you have a firm grasp on how to remove the most difficult errors from your report, you’ll still need to focus on creating a new line of credit.
The role of your credit score is to give lenders a biased view of who you are and whether you’re trustworthy to repay a loan. Your credit score will also determine what type of interest rate you will have on your loan.
Nine out of ten experts will recommend that you get rid of all your revolving accounts once you begin the credit repair process. As always, I plan to go in the opposite direction. I advise my students in my workshop to keep two revolving accounts, which is usually a Master Card and a Visa. These are called revolving accounts, and if used correctly, they can increase your credit score by 150 points. The goal is to keep your credit card balances at 20% or less.
If you don’t currently have a credit card, don’t worry, this is not a problem. You can always get a secured credit card that works just as well. You can’t use a department store type card because, when it comes to rebuilding credit, they’re extremely harmful, but that’s a whole other item.
Statistics show that most people with credit cards end up ruining their credit because they don’t understand the five ratios that dramatically affect their credit scores. In a nutshell, the five usage ratios are as follows: 20, 40, 60, 80, and 100 percent. Let me give you a real life example… If you were to use your credit card(s) with balances at eighty percent, your credit score would go down. If you kept your balances at twenty percent, your credit score would increase by about 150 points. The two-thirds below sixty will raise your credit score and the two-thirds above sixty will lower your credit score.
It would be wise to arm yourself with the proper knowledge before preparing for the credit rebuilding battle. You must prepare for a two-pronged approach. The first aspect is the process of establishing new lines of credit. The second prong is to remove all discrepancies from your credit report. By removing dents from your credit report, you could easily boost your credit score an extra 300 points.
Establishing new lines of credit is quite easy and the process can be completed in a few weeks. Removing errors from your credit report can be a bit more difficult and it is recommended that you arm yourself with a good credit repair system.
