Rebuilding Credit
For some, re-establishing a positive credit history can seem like an impossible feat, but it doesn’t have to.
Credit problems can happen to anyone, especially after a financial setback such as separation, divorce, job termination, change in employment or costly medical bills. With any of these situations, if you cannot pay as agreed, you may suffer an undesirable credit rating.
Remember, a positive credit rating is an essential component of financial wellness.
Steps to rebuild a positive history
First, take a close look at your financial situation. Obtain a copy of your credit report. All U.S. consumers may obtain a free copy of their credit reports from the three major credit bureaus. Visit www.annualcreditreport.com or call toll free, 877.322.8228.
Second, look over the report and mark any areas of concern. Focus on what is necessary to implement change. If your budget allows, pay off or bring current any accounts that are past due. You can start by making contact with your creditors to discuss your situation and make clear your intentions. Be specific with amounts, dates and promises. It is essential to make payments as agreed, as this is a crucial step in improving your credit rating.
Third, place a statement on your credit file to explain any extenuating circumstances. You have up to 100 words to state reasons for any adverse information. With this information, every time the credit report is pulled, the creditor will be able to take into consideration the events that led to your situation. It could make a difference in credit being granted or denied.
To rebuild credit, start where you are and take bite-sized chunks. Over time, the positive information will carry more weight than the adverse information.
Contact your Credit Union at 877-367-5428 to speak with a financial planner. We are available to assist you with creating a financial plan to repay your debts.
