Fix Your Finances: Ideas for Rebuilding Credit

Fix Your Finances: Ideas for Rebuilding Credit

“Remember that credit is money.” ~Benjamin Franklin

There are several ways that we can rebuild credit when you’ve had tough times. Financial abuse is real for narcissistic abuse victims! No one should judge you. But if you are tired of collectors hounding you, or if you are frustrated that no one will loan you money because you never had credit, it is time to learn how to build your credit. First, and foremost, never purchase items you do not need. If you ‘want’, do not let your wants wear you down and get you deeper in debt. If you are searching to build credit and have no history at all, make sure you have your priorities in order.

Bad Credit? Tips for Building Credit

So, you got yourself in a little trouble. Whatever the reason your credit’s bad, I’m not judging you. We’ve all been there–but we are here to fix this problem, not talk about how terrible it is, so let’s do this.

What are my rights when it comes to credit scores?

Your rights, as they apply to your credit and according to the FTC, are as follows.

  • You’re entitled to a free credit report if a company takes “adverse action” against you, like denying your application for credit, insurance, or employment.
  • You have to ask for your report within 60 days of receiving notice of the action. The notice includes the name, address, and phone number of the consumer reporting company.
  • You’re also entitled to one free report a year if you’re unemployed and plan to look for a job within 60 days; if you’re on welfare; or if your report is inaccurate because of fraud, including identity theft.
  • Each of the nationwide credit reporting companies — Equifax, Experian, and TransUnion — is required to provide you with a free copy of your credit report once every 12 months, if you ask for it. To order, visit annualcreditreport.com, or call 1-877-322-8228. You may order reports from each of the three credit reporting companies at the same time, or you can stagger your requests throughout the year.
  • It doesn’t cost anything to dispute mistakes or outdated items on your credit report. Both the credit reporting company and the information provider (the person, company, or organization that provides information about you to a credit reporting company) are responsible for correcting inaccurate or incomplete information in your report.
  • To take advantage of all your rights, contact both the credit reporting company and the information provider.

The Ups and Downs of your Credit Rating

More Tips for Bad Credit Repair After Narcissistic Abuse

  • There are systematic guides at your local library that will teach you, as a debtor, how to write letters to creditors.
  • Don’t be afraid to call a creditor and explain your situation. Even if you have ignored their calls for months, they will work with you in most cases. Communication will make you feel better and will help your creditor to understand your situation. While it may not immediately solve your credit problems, it is definitely a step on the road to recovery.
  • Any documents that pertain to your credit history should be stored in a safe area. If you send letters to your creditors keep a copy of each letter sent and store it in a safe area.
  • If you notice any errors on your bills or credit, reports make sure that you contact the appropriate professionals and dispute the charges immediately. Once you have disputed the charges with the sources you will then contact your card provider and let them know what occurred.
  • If you are lucky enough to have a credit card with bad credit, please don’t use the card to repay your debts and then meet the monthly installments on the credit card each month. That would mean getting out of debt while going in debt deeper–how sensible is that? It might seem like the only solution when all else false, but credit cards have interest rates so the bills each month on the card will increase.
Fix Your Finances: Building New Credit and Better Spending Habits

Fix Your Finances: Building New Credit and Better Spending Habits

Repairing your credit means getting rid of the negative credit report information and catching up on your overdue bills. This could raise your credit score but might not be enough to make you credit worthy again. However, to raise your credit score high enough to entitle you to a loan, you have to rebuild your credit. Doing so would only prove that you have the capability to handle credit responsibility.

It might be tough to get started, but once you achieve that momentum you need, you will be sashaying toward a good credit score. You can always begin by developing better credit habits.

Using a credit card is one way you can work toward building your credit.

Tips for Using Your Credit Card Wisely

You’ve got to start with healthy spending habits if you’re going to get your financial situation in order.

  1. Don’t use your credit card to make your everyday purchases,  such as food, gas and clothing. Use your debit card or pay cash.
  2. When you can afford to, pay more than the minimum required payment. If you make minimum payments each month, you’ll end up paying significantly more over time in interest.
  3. Don’t buy things you can’t afford. Living off “borrowed money” will keep you in debt forever.
  4. Buy things you need rather than things you want. Save up and pay cash for things you want.
  5. If you can’t make a payment in time, let the creditor know immediately–ideally before the due date. Most creditors offer assistance or will allow you to delay a payment if you just communicate with them.
  6. Don’t exceed your credit limit. Ideally, you should keep your debt level at 30 percent or less of your credit limit. Your credit score is impacted by the quantity of debt you have, but you also must have SOME debt. Keeping your balances low is the smart way to go here.
Fix Your Finances: Ideas for Rebuilding Credit

Fix Your Finances: 3 Things To Look For In A Credit Repair Company Online

If you’ve gone through financial abuse in a toxic relationship with a narcissist, chances are you might need to think about repairing your credit. While there are plenty of ways you can DIY your credit repair, you might find it overwhelming and want to look into a credit repair company.

Plus, if it’s been a while since you’ve looked at your credit report, or if the narcissist was hiding things from you (all too common in these relationships) you may be surprised to find errors, mistakes, or even a black mark or two.

How do you avoid an unethical credit repair company?

Fortunately, a Credit Repair Company can help you fix those mistakes and erase those black marks. Watch out for scammers, though, and choose a reputable Credit Repair Company with these tips.

Don’t pay anything upfront

Avoid a Credit Repair Company that wants you to hand over a fee or payment before they meet with you. That’s always a red flag. Reputable companies will first talk to you, assess your credit report and discuss your current situation before asking for any type of payment for their services.

An up-front fee is a red flag that the company will probably take your money and run. And no matter what type of charges you may incur, be sure they aren’t exorbitant. If a Credit Repair Company claims your case will cost thousands of dollars, look for another one.

Watch out for “re-inventors”

Some companies will tell you that you can wipe your credit slate clean by “re-inventing” yourself with a new social security number. But that’s not true!

In most cases, what they plan to do is get you a new credit report by applying for an Employee Identification Number (EIN)–used by businesses–which resembles a social security number, and you’re told to use it as such. But this practice, known as “file segregation,” is a scam, and it’s also illegal!

Avoid any Credit Repair Company that suggests this practice.

Look for a credit repair agency that helps you help yourself

A good Credit Repair Company will tell you (for free!) what you can do yourself, such as writing letters to creditors and contacting the credit reporting bureaus about errors.

Avoid any Credit Repair Company that encourages you to do anything illegal or unethical–such as disputing a legitimate charge or fee on your credit report.

Before signing up with any Credit Repair Company, make sure you check with the Better Business Bureau. They’ll have records of any formal complaints against the company, so you can avoid scammers and rip-off artists.

More Resources for Financial Abuse Victims

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