The only sure fire cure for a bad credit report is time. Time is your greatest ally when it comes to repairing bad credit. It can take up to 21 years to remove a bankruptcy from your report provided all payments have been made on time. If you have been late with payments on your mortgage, car loan, or other loan, good old time creditors can and will report your delinquency in your credit report. If you miss payments or make payments late on a credit card, credit card companies can and will report this too.
It can take seven years to remove a Chapter 7 bankruptcy from a credit report whereas it might only take three to four years to remove a Chapter 13 bankruptcy. Other things that might slow down the bankruptcy process is if you get fired from a job, have a divorce, or are unable to find a job. If you file for bankruptcy and are unable to get a job, this can also affect your ability to use a bankruptcy to buy a home.
Freeze Your Credit
Having credit that is "frozen" or closed requires no action on your part. Each time you buy on a credit card or open an account, this allows the card issuer to place a hold on your account for up to 90 days. That means they will not let you open new accounts unless you can prove necessary expenses. Once it is "frozen" it is usually at least six months before this type of credit report can be unfrozen again. This gives plenty of time for any delinquent accounts to be paid. This time is much less than if approval for a new card is contingent on the fact that the applicant can prove needed expenses.
Closing Your Credit Card
If a credit card is closed, when this occurs the account is closed. The card company cannot allow you to open another credit card for up to five years or place restrictions on administering a new credit card account. When this happens, the cardholder must call the closed card company and request that the closed card company restores the credit card. Some companies will do this, but some will not. The requirement is typically for the cardholder to have a new account opened and that the cardholder prove their need for the credit after the card was closed. For example, if a young student needed access to a credit card to fund a computer project, the issuing company might agree to this. Credit card companies do not want to limit their clients' ability to borrow.
Don't Be Late
This problem occurs after lenders closed your account. It is actually a good thing. These statements are true, but less so. A credit report lists most late bill payments and if the said loans were late by 30 days or more, the report will list them. A credit card which is "closed due to non-payment" doesn't help much. You still owe the debt, and if you can't pay it, it will be reported as a late payment. If the account was seriously delinquent, you might be faced with a lawsuit. In this case, the lenders will be more likely to obtain a judgment. Sometimes they will execute a sheriff's sale and have you arrested. The problem with a judgment is that all of your wages during the duration of the lawsuit are garnished. Ask the lender if they can fix it immediately, or close the account and do so only if you can prove useful to them as an account customer. By this time, even a credit worthy co-borrower can be denied credit if they show up on your credit report.
If you want to close the account, request the lender to list all outstanding obligations and their respective balances. From this, you can easily decide which card should be closed. Credit ratings and scores are not as pertinent to a credit line as being able to pay the bills in a timely manner is. Be sure to contact the lender and caused a hardship that will prevent you from making payments on the debt. This would be a good reason to set up automatic payments. If you become unemployed or are unable to work, request a forbearance agreement so your credit history will not be damaged.
The easiest is to simply pay your bills, but that is not always a viable option. Many people look for a way to find extra money to pay more than the minimum payment required. As long as the minimum payment is not adversely affecting your credit score, it is financially citizens' punishment to happen. What you can do is max outsource debt, including your bills.
People are generally apprehensive about doing this, but it hardly cost anything and is relatively easy to accomplish.
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