In Part 5 of this Credit Repair series of Improving Credit Report Score, we focus on keeping neat and easy for access updated personal accounts. This could be viewed a trivial to some readers, but if I tell you that proper record keeping could mean a vast difference in your eventual credit report scores, you would probably give it more priority.
Avoid Messy Records. Personal financial records are but one aspect of the many things that are happening in your lives. Home loans and insurance, auto loans and insurance, personal tax payments, insurance nomination confirmations, marriage certificates, children birth certificates, new home deeds, home rental contracts, are but simply a portion of the many critical records that could affect your credit reports in the future. So keep all documents in neatly segregated files for future references. Not knowing what is going on in your own financial life is courting disaster.
Avoid Dated Records. All personal financial records should be kept in chronological order segregated in different folders by type of records. Review each of the folders periodically, especially when there are changes in your life stages. In fact, should you be resettling at another location, you will need to update every related parties managing your finances.
For instance, you may wish to review your personal financial folder which contains your credit reports and credit repair activities on a regular basis, or review your insurance folder when you need to re nominate beneficiaries etc. Keep the folders on hand in case you move on to a new state or province and need to start new credit accounts. You will surely find them handy when trying to contact your bankers and lenders to make credit repair arrangements.
Should you move and omitted to inform your lenders of your ne address, you might never get your bills, consequently never paid them up causing your credit score to fall drastically. Hence it is in fact very critical that you either close your credit accounts or update your new address and contact information with all your creditors and lenders whenever you move.
Avoid switching credit companies and credit accounts. Being loyal to a single credit company is no longer the buzzword for the modern day person. However, amidst the enticing special premium rates, free gifts or privileges for you, the other esteemed client, you should always keep your cool and not be tempted to switch. Switching accounts and lenders makes you seem fickle and unreliable.
Relationship building requires three key elements to work, namely you, your banker and time. A good solid credit account built since your days at college takes time to build, and display your consistency, stability, commitment and steadfastness in life and credit management. This is the type of profile that lenders fully appreciate, and customer loyalty might just be rewarded accordingly.
And here is a final word on closed accounts too. Whenever you close any account, be it a credit card, personal credit lines, auto or home loans, or even a utility account, ensure that you obtain a written confirmation from the related company that you have fully paid up your accounts. This good habit will serve you well, especially in keeping up your good credit scores.
This series of articles on Key Credit Repair Tips to Improve your credit report scores describes the common pitfalls that laypersons commit without having sufficient understanding of the credit reporting system and the solutions to help repair their credit scores. This part of the series discusses the importance both time and timing when executing credit repair activities.
Over Time, In Time. Key to this theme is Time. Note that should you close all your dormant accounts within a short period of time, it may be difficult for your credit reports to immediately detect the closures and you will need to take a temporary hit on your overall credit score with a higher credit balances spread out over a smaller overall credit account base. Over time however, as you pay off your outstanding debts, you credit ratio will be lowered and credit score rectified..
In addition, note that you should not adjust your credit score by dormant account closures in the following two scenarios. Firstly, if you are applying for a loan, you might be disadvantaged by the temporary drop in your credit score, giving rise to less favorable loan rates. Secondly, never close your dormant accounts when you have a high overall debt balance.
Only Keep What You Need, Get Rid Of The Rest, Over Time. You were reviewing your credit report when you chance upon the forgotten credit accounts you opened for those just in case impulse buys some time ago. It seemed that these accounts are culprit to your low credit scores in your credit reports. The very fact that you have forgotten about them, implies that you do not need or use them at all, but if left unattended, you will probably not remember you had them and even stop payment on them, hence eventually negatively affecting your credit score.
Since you do not need and have never used the additional credit lines, only keep the active accounts and begin closing your other accounts. But ensure that you close your accounts on a progressive manner and not all at once. Subsequently, you should update your credit reporting bureaus with supporting documentation on your accounts closures. Over time, your credit scores will improve.
The Mindset Of Credit Reporting Bureaus. And finally, from the perspectives of the Credit Reporting bureaus, most view it more favorably with good long term credit history. So if you wish to close your dormant accounts, close the most recent accounts first and only if you do not need the extra credit.
Essentially, you would be ill advised should you actively close up all dormant credit accounts within a short span of time or without correctly timing the closure with your financial needs.
Understand that improving your credit score and eventually getting a good credit report takes time and effort.
Stay tuned while we discuss more Credit Repair skills in the next parted of this series and visit my site for more information.
Joey Lee has sinced written about articles on various topics from Hybrid Cars, Credit Repair Companies and Cars. Joey Lee has 17 years of banking, financial, business & marketing experience, holds a CFP & an Executive MBA, and a Platinum Ezine Author. Learn authentic Credit Repair skills and comprehensive information on. Joey Lee's top article generates over 18100 views. to your Favourites.