5 Tips for Handling Bad Credit

We all wish we had excellent credit, but sometimes life gets in the way. We get into financial trouble, and our credit score quickly drops. Too often, we think there is nothing we can do to better weather our bad credit, even after our financial situation bounces back. Luckily, there are five things you can do to make handling bad credit easier.

1. Check your credit report for mistakes. You’d be surprised how commonly mistakes are reported on credit reports. If you haven’t carefully scrutinized your credit report recently, you may be surprised to discover that there errors lowering your score, especially if you have had payment issues in the past. Double check that your credit score is up to date, and call to get all errors removed right away.

2. Work on rebuilding your credit. Just because you have poor credit now doesn’t mean that it has to stay that way. You can constantly work to improve your credit by maximizing your credit score. Check out our blog on tips to improve your credit fast to learn some simple tricks to help you rebuild your credit more quickly.

3. Pay all your bills on time every month. Now that your utilities and your cable and phone bills are all used to calculate your credit score, it is even more important to pay all your bills on time—and doing so will reap you a bigger reward. It may seem like a small action, but the more bills you pay according to schedule, the faster your bad credit will become good credit.

4. Use credit cards responsibly. If you have bad credit, you may feel tempted to swear off credit cards for good, but this actually can make improving and handling bad credit more difficult. Instead, use credit cards for small regular payments (such as a Netflix account or your cell phone bill). Just keep in mind that you will most likely only have access to high rate cards, so you must resist the temptation to use such cards a lot.

5. Pay off your balance in full every month. A credit card myth we hear too often is that you must carry a small balance on your credit cards in order to build credit. That couldn’t be farther from the truth. When you pay off your balance at the end of the month, you still build credit. Plus, you do yourself even more favors by avoiding high interest rates and maximizing your credit utilization score.

If you do these things, your bad credit won’t feel like such a burden—and it will steadily improve faster than you may expect. Don’t let your bad credit —or the prospective of lower credit—get in the way of your financial health. Your credit score is constantly changing, so a bad credit score is always a temporary situation that you have the control to change.

As bankruptcy attorneys, we see innumerable people who are afraid to take healthy financial steps like declaring bankruptcy simply because of the impact on their credit. Not only is this fear often unfounded anyways, since high levels of unpaid debt is just as damaging or worse than a bankruptcy for many people, but such fears are also unnecessary, since you have the power to improve your bad credit a little bit at a time. If you are worried about your credit score and debts piling up, call our Ohio consumer debt attorneys right away at (888) 726-3181 for a free consultation on your unique situation to find out how we may be able to help.