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Bad Credit Blues: 4 Ways To Raise Your Credit Score

Having bad credit can hinder your ability to get financing for some of the bigger investments in life such as buying a home. In fact, low credit scores can make it tough to rent an apartment, buy a cell phone, or even get a decent rate on insurance premiums for your home. Luckily, your low credit score isn't set in stone. Here are four effective ways you can go about raising your score once and for all:

Make Some Payment Arrangements

If you're facing delinquent accounts on your credit report, you'll need to work on getting them paid off so that they no longer play a negative role in your score. You may be able to get your debtors to agree to payment arrangements so you can fit the payments into your budget without feeling the pinch too much. Here are a couple of options to consider:

  • Work with a debt consolidation company who will make payment arrangements for you.
  • Schedule a meeting with each debtor and provide a repayment proposal.
  • Simply start sending payments to debtors on a regular basis.

Some debtors may be willing to report your payments to the credit bureau as you make them, which will work to increase your score while you settle your accounts instead of having to wait until they're fully paid off.

Get a Bad Credit Car Loan

Believe it or not, investing in a new or used vehicle is a great way to improve your credit score overall. This is true even if you have a not-so-great history with other debtors. It's really just a matter of finding a dealership that's willing to work with people who have imperfect credit (there are many!) and finding a vehicle that you want to buy. Luckily many dealerships now offer bad credit car loans.

Your credit report will reflect each payment that you make which should start to affect your score within just a couple of months. But keep in mind that building your credit doesn't erase the delinquent records on your account so you'll still need to address those in order to benefit from a good credit score overall.

Apply for Secured Credit

A secured credit card doesn't really provide you with the ability to purchase things on credit. You'll be expected to fund the card with your own money before using it. The system works a lot like a bank account where you'll be spending money that you already have. But with each deposit and each purchase, your credit score will grow.

And the best part is that you won't be putting yourself in debt in exchange for that higher score. Some credit companies are willing provide you with unsecured credit after proving your ability to fund your secured account on a regular basis. But don't assume this is the case when choosing a secured credit card. If this is something you're interested in working toward, make sure that the company offers this opportunity before you sign anything.

Get the Scissors Out

If you still have credit cards lurking in your wallet or in a desk at home, make sure there is never any temptation to use them by simply cutting them up with scissors. By adopting a cash-only financial lifestyle, you'll ensure that you don't put any more stress on your credit score as you work to repair it. When there aren't any credit card bills to keep up with on a monthly basis, you'll find it much easier to find the funds to pay off old debts.

After putting some of these methods to use you'll be well on your way to experiencing a financially stress free lifestyle. You may also find that various opportunities open up for you once your credit score is out of the woods. Read on for more information.