Having a very bad credit score (ranging from 300 to 560 in the FICO score range) can be a difficult situation to be in, as it can make it hard to get approved for any loan or credit card. However, it is possible to repair your poor credit history. Here are some tips and ways to do so.The first step is to start paying off your balances. This will slowly improve your credit score, but it is important to make sure you make at least the minimum payment on each of your loans and avoid accumulating additional debts.
Whenever possible, make additional payments to pay off your debts faster. It is also important to note that lenders often group together borrowers with similar credit scores when making credit decisions. Therefore, it is important to make sure you pay your utility bills on time and avoid sending bills to collections, as this can damage your credit. Other things such as having accounts receivable for unpaid bills or having a bankruptcy in your history can also lower your credit score.You may be tempted to close all of your credit accounts, but this is not recommended as it will stop you from having a FICO score completely after six months.
If a card has a high annual fee and you no longer use it, evaluate the potential downsides of a shorter credit history with the money you could save. Some states prohibit this practice, and some insurers don't take your credit into account even when allowed.Student loans are among the easiest loans to obtain when you have a low credit score, considering that almost 25% of them are granted to applicants with a credit score of 300 to 539.If you have an up-to-date copy of your personal credit report, simply enter the report number where it is indicated and follow the instructions provided.Your credit score can affect you in many ways, and having poor credit can make some aspects of your life more costly or difficult. Upsolve is a non-profit organization that can help answer your questions about credit issues, credit scores, debts and bankruptcies.If you have a very bad credit score (between 300 and 560), remember that you can work to improve it and repair your credit. Paying off balances, avoiding accumulating additional debts, making sure bills are paid on time and not closing all of your credit accounts are all steps that can help you do so.
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