How to fix bad credit?

Bad credit history can affect a person's life for years. It may prevent you from getting a credit card, financing a car loan, even buying your dream home. Unfortunately there is no magic bullet to fix it quickly.

"Credit problems? No problem!" "Create a new credit identity-legally." You see the advertisements almost everywhere. Do yourself a favor and save some money, too. Don't believe these statements. Only time, a conscious effort, and a personal debt repayment plan will improve your credit report.

Don't Despair. Just because you have a poor credit report doesn't mean you won't be able to get credit. Creditors set their own credit-granting standards and not all of them look at your credit history the same way. Some may look only at more recent years to evaluate you for credit, and they may grant credit if your bill-paying history has improved. It may be worthwhile to contact creditors informally to discuss their credit standards. Here are some suggestions:

• Obtain at least one copy of your credit report. Even if you don't have a poor credit history, it's a good idea to conduct your own credit check-up, especially if you're planning a major purchase, such as a home or car. Checking in advance on the accuracy of the information in your credit report could speed the credit-granting process.

• Verify if all information on the report is correct. Under the FCRA, both the CRA and the organization that provided the information to the CRA, such as a bank or credit card company, have responsibilities for correcting inaccurate or incomplete information in your report. To protect all your rights under the law, contact both the CRA and the information provider. More information on this can be found here.

• If you have a high interest debt, one common way to fix bad credit is to use a home equity loan to consolidate the high interest debt.

• If you can't resolve your credit problems yourself or you need additional help, you may want to contact a credit counseling service. There are non-profit organizations in every state that counsel consumers in debt. Counselors try to arrange repayment plans that are acceptable to you and your creditors. They also can help you set up a realistic budget. These counseling services are offered at little or no cost to consumers. You can find the office nearest you by checking the white pages of your telephone directory.

• In addition, nonprofit counseling programs sometimes are operated by universities, military bases, credit unions, and housing authorities. They're also likely to charge little or nothing for their services. Or, you can check with your local bank or consumer protection office to see if it has a list of reputable, low-cost financial counseling services.

• If you need credit fast, you may apply for a secured credit card. It allows you to slowly rebuild and repair the bad credit. We recommend a secured credit card from First Premier Bank.

• Be patient - it takes time to re-build your credit. It's important to stay on top of good financial habbit while the old credit fades into your past.