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Consumers Searching for Ways to Rebuild Their Credit

[Aug 7, 2007.]

 

This summer, a number of American consumers are looking for ways to rebuild their credit history. Such a goal is important, considering the fact that a less-than-stellar credit rating can cost you thousands of dollars in interest and life insurance costs.

But how can you go about restoring your credit worthiness at a time when high interest rates and sky-high gasoline prices may make it difficult for you to pay your monthly bills?

To begin with, financial experts say that, this year, obtaining a secured credit card can be the ticket to improving your credit score. You simply deposit cash as collateral and you begin to charge. If you make your payments in a timely fashion, your good credit can be restored. It's best if you can obtain a card that has no application fee.

Next, make sure you're paying more than the minimum monthly payment on your credit card bills. If you simply pay the minimum, you'll make little headway in retiring your balance and your overall credit score could suffer as a result. The more you're able to pay each month, the better able you'll be to attack your credit card balance. Also, make sure you're up to speed on credit card interest rates and shop around for the best deal. Through balance transfers to lower-rate cards, you may be able to save a great deal of money in the long run.

Another sound financial strategy this summer is to do a quick check of your credit report. Inaccuracies on your report could actually end up costing you money. That's because negative entries can cause creditors to charge you higher interest rates. In order to obtain a free credit report, visit FTC.gov.

Of course, in order to improve your credit score, you'll have to exercise patience. That's because derogatory information can remain on your credit report for as long as 7 years.

Julie Ann Amos
August 7th 2007

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