Credit scores are key to getting credit at favorable rates. Consumers with good credit scores of 725 and above are considered excellent risks. Those with scores below 620 are considered risky and therefore are either denied credit or offered credit at high interest rates.
What can you do to fix a bad credit history? The BBB advises consumers to take positive action to correct credit problems by paying bills on time and reducing the amount owed on credit cards.
Other steps to fix bad credit include:
- Contact your creditors and explain why you’re having trouble paying your bills. See if they will help you work out a manageable payment plan. Once arranged, follow it carefully. Don’t wait until your account has been turned over to a collection agency.
- If you have been turned down or feel an error exists on your credit report, contact the reporting agency in writing and send your appeal by mail “return receipt requested.” Include your name, address, account number, dollar amount in question and the reason you believe the actions taken were wrong.
- If in doubt, request written verification of the debt. Ask for a photocopy of the paperwork including the signature(s).
- Keep receipts, sales slips and billing statements to make sure they match. You may need them if you dispute a bill or report. If the credit agency requests documents, send copies; never send your originals.
- Be skeptical of companies that promise they can immediately solve your credit problems or “clean up your credit report.” There is nothing they can do for you – for a fee – that you cannot do for yourself at little or no cost.
- Be persistent. If your credit file contains errors, you are entitled to have it investigated by the credit bureau. The credit-reporting agency must give you a written report of its investigation and a copy of your report if the investigation results in any change. Inaccurate information must be corrected or deleted. Cleaning up errors on your credit report can take time and effort.
- Request your free annual credit report from all three credit-reporting agencies at freecreditreport.com.
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About the BBB
The Better Business Bureau, founded in 1912, is a champion for ethics and trust in the marketplace. Only businesses that meet the high BBB standards are invited to become BBB Accredited Businesses. Today, 123 BBBs across the United States and Canada rate more than 4 million local and national businesses and charities with scores ranging from A+ to F. Only a BBB Accredited Business may elect to participate in BBBOnLine, one of the most trusted and recognized Internet seal programs in the world.
The BBB serving northern Colorado and Wyoming topped 1.1 million instances of service to consumers and businesses in the last 12 months. These services include reliability reports on local companies and charities, access to companies that can be trusted by industry, help with dispute resolution, and trustworthy information on consumer and business topics.
Luanne Kadlub, BBB media relations manager, 970-488-2044 lkadlub@wynco.bbb.org