Which is the best way to go to clear up my credit file

Hi Diabla

Welcome to the forums.

Your three digit credit score is the most important factor to analyze your financial worthiness. Based on these credit score, loans or credit can be acquired from the creditors and other lending agencies. When the credit score is evaluated, extensive research is conducted on the following areas of your credit report.

• Your payment history is analyzed.
  
  
• The amount that you owe is taken into consideration.
  
  
• Length of your credit history is determined.
  
  
• They look out for the types of credit that you have used so far.
  
  
• They will look into your new credit.
  

Please use the following tips to improve your credit score.

Check for incorrect entries - It is mandatory to check your credit report for any mistakes from all the three credit reporting agencies. You can review your report for at least once in a year as well as several months before you apply for a loan.

Timely payments It will be considered a very good practice if you always pay your bills on time. Your prompt payments will put you in a much comfortable position before you apply for a loan. This point is emphasized because a late or missed payment just before applying for a loan lowers the credit score and has worse impact than a missed payment five years ago.

Bring credit balance to the minimum - It is always beneficial to reduce the credit card balances as much as possible. The FICO scores get affected due to how much money you owe on some cards relative to your total credit limit. Credit scores are seen improving if the balances are kept below 25% of the credit card limit.

Don't linger your payments It is suggested not to increase the ratio by closing an account and transferring the remaining balance to another account since the ratio of the credit card balance is linked to the credit limit. Doing this will lower the credit score which should not be generally done while you are on your way to increase your credit score.

Unused accounts to be kept active - While you are applying for a loan, it is suggested not to close any unused account. At the same time, it is suggested not to open a new account also during that time. It is said because if you are having a short credit history or less number of accounts, the credit score gets lowered when a new account is opened as there is no proven track record of it.

Please do let us know your feedback. We will appreciate your comments and suggestions for the community welfare.

Consolidation program will be better in comparison to settlement program. The latter has a negative impact on your credit report and it will hurt your credit ratings considerably.

Please understand these two avenues in the article given below before you make a choice.

http://forums.debtcc.com/forums/comparison.html

Regards
Roxette