If you take a loan with higher interest rates, go on a shopping spree without a care in the world or make your favorite trips down to the casino, you are likely to pile up on your debts. At some point, these debts with the mounting interests are bound to get the better of you. A few defaults and consistently late and insufficient payments can lead you to bad credit, which is quite a precarious situation. Whatever be the reason of going into bad credit at the first place, all is not lost and you need to get out of it as soon as possible.
The first thing to do is to get your credit report which is available online and check if it is accurate. There is a possibility of some debts that are not accurate and you can file a petition for correcting it straightaway. Once the report looks fine to you, an assessment of your debts has to be taken.
A good consultant can help if you can afford. This is because the next step for you is to go for a debt consolidation loan or a bad credit loan. In this, a lender will repay all your debts, so that you are left with just one bigger debt which can be managed and monitored better. Secondly, because you mean business, lenders are likely to take up all the loans and give you a new loan for a lower interest rate making it easier for you to get out of bad credit.
You should talk to as many lenders as possible to get the quotes for interest rates and loan terms. The best offers are those which are simple. Although, some offers include initial term period discounts and zero percent interest rate for a fixed period, you need to be wary of them. Some of these could well be balloon payments where the monthly payment rate and amount explodes towards the end leaving you in a similar situation at the end of the term.
After deciding upon a good offer, you should start repaying off the loan amount as quickly as possible. Another important thing here is to avoid prepayment penalties that some lenders impose wherein if you pay off the loans much before the loan term finishes you need to pay some extra money as penalty. Regular monthly payment over a period of time will get your credit and the credit score back on track.