Many people have experienced problems with mounting credit card debts. This does not mean it is time to stop using your credit cards; rather, it is time to re-evaluate how you have been using these cards. Credit cards and credit history are two things that are essential to survival today. Whether you apply for a job, a new credit card, a new account or a loan your credit history will be scrutinized. This is of course as per regulations done with your knowledge and if you are denied on account of your credit history the firm is required to furnish reason why along with a copy of your credit report. Bad credit history can reflect on a number of areas of your life and how you deal with it can decide what happens next.
If you are looking to work out a way to fix your bad credit history you are certainly not alone. There are millions of families reading up and undergoing debt counseling in an attempt to avoid bankruptcy and fix their credit card debts. An important fact is that revolving credit is one of the main aspects of credit history. Each time you delay payment on your credit card or you forget because you have one too many cards to track you get reported to one of the three bureaus and your credit score gets affected. As one single incident can bring it down, building it up is a time consuming process. It happens over years. If you wish to sort out your credit card debts then you have to start at the beginning, by looking at your credit report.
When you use your credit card, or when you look at your credit card statement you can rethink on what went wrong and caused the bad credit history. Those impromptu payments and spending sprees have done the damage. But so have big purchases made in bulk with your credit card. Credit cards do give you spending power, but only in so much as you can repay it or afford it. If you are making a bulk purchase, be sure that you have money set aside to meet with monthly payments. Refrain from making other payments on it until you close the larger amount.
If you can fix your bad credit history, you can have a lot for benefits. Firstly you will be eligible for a better card with low interest rates and nu annual fees. You will also get a larger credit limit. But the hike in credit limit does not mean you automatically max out your card. Rather you should be able to strike a balance between your credit to debit ratio. If you end up spending more than you earn just because your bigger credit limit allows it, you will end up with late payments and debts. Switch to a secured credit card
or a prepaid credit card
so you do not do damage to your credit score. Also if you are not using a credit card, close it, having multiple accounts open is not doing anything for your credit score.