It wasn't all that long ago that
American's faced great financial crisis. As a nation, we struggle
with debt, and it keeps us from achieving a better life. Debt
Education is here to help you change all that ... just ask!
REAL PEOPLE ... CARING ABOUT REAL
ISSUES
Tips on Re-establishing Credit
Develop a money management plan or budget. Your plan should include
savings, housing, food, clothing, medical, insurance, auto and
transportation, childcare costs, entertainment and other expenses.
Buy reasonably priced items of real need with payments that fit
easily into your budget.
• Pay as promised, on or before the due date.
• Put some money away each month. Establish a savings account.
Creditors consider this evidence that you can handle money. Use
it, if necessary, as security to borrow against.
• Establish a personal contact with the branch manager or
loan officer of the bank or credit union where you maintain your
accounts.
• Contact creditors whose accounts you have paid off earlier.
They may consider reopening a line of credit. Points they may
consider are how regular your payments were before problems arose
and how long it took to resolve your problems.
• Do not make several applications for credit within a short
time. Creditors sometimes look upon this unfavorably. Apply to
one creditor and allow your repayment record to establish itself
before applying elsewhere.
• Accept offers for pre-approved credit cards, but be aware
of high interest rates.
• Accept offers from dealers who sell and finance their
own merchandise. Take advantage of 90 days same as cash.
• If you must borrow money, offer security such as a car,
savings account or other valuable property.
• If necessary, ask a relative or friend who has good credit
standing to co-sign a loan application and share your liability.
• Avoid so-called credit repair clinics which charge
high fees for doing what you can do yourself. The FFI's resource
centers section on credit repair can provide information on the
procedure to follow.
IF CREDIT IS DENIED
• Ask the creditor to furnish, in writing, the reason credit
was denied.
• Check with the credit-reporting agency listed as the source
of the adverse report to determine if the information reported
is accurate. If the report is in error, you can have the incorrect
information removed.
• Do not apply for credit elsewhere until the reason for
the denial has been resolved.
• Keep in mind that the creditor is also looking at other
factors such as length of time on the job, length of time at one
address, and the percentage of income owed out of "take home"
pay excluding housing cost. For most people, this should not exceed
20% excluding mortgage and car payments.
There's a lot of information to read through on the Debt Education
website, but we feel this is extremely important material. We
strongly recommend that you bookmark
this page right now. This will allow you to read
at your leisure, and should you need to attend to other matters,
easily return back here at your convenience.
The Debt Education website was built for you. Please explore
our website. You'll find resources and information on virtually
every aspect of financial planning and money management. These
debt delp resources are designed to help you get out of debt
and stay out of debt. You can achieve financial independence.
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Debt Education PO Box 5156, Santa Cruz, CA 95063
