With the state of the economy being what it is, many Canadians are finding themselves in bad credit situations.
Credit can seem like a never-ending downward spiral, but you can fix your credit on your own with a bit of know-how.
Quick Credit Fix There's really no such thing as a quick credit fix.
Unfortunately, credit takes months, sometimes years, to repair.
Still, there's no need to panic when it comes to your credit.
Instead, take a deep breath and try to follow these simple steps: - Make payments on time: try and pay all bills, credit cards, and other payments on time every month.
- Avoid overdrafts: bank overdrafts can really impact your credit.
If you don't have a bank account that includes overdraft protection, it might be time to switch banks.
- Be consistent: keep making payments on time for the next two years.
The more consistent you are, the better off your credit report will be.
- Prove that you can handle loans: take out a loan that you can handle, and make sure to pay it off on time.
This will really help your credit to improve.
Why Loans Help The main reason why bad credit happens is that most people borrow more money than they can actually afford to borrow.
When this happens, payments are missed.
When payments are missed, credit ratings drop drastically.
If you presently have bad credit, taking out a new loan might not seem too wise.
However, this is actually a great way to improve your credit score.
You see, if you can prove to credit rating companies that you can handle a loan, then your score will improve.
Simple Loans Those people with bad credit aren't likely to be approved for a bank loan.
The good news is that you don't need a bank loan to prove that you can handle a loan.
Instead, look for a private lender that will grant you a loan based upon collateral.
If you own a car, a car title loan may be the solution.
Car title loans are one of the simplest loans to obtain.
If you own your own car, then you can use your car as collateral in order to obtain a loan.
By paying back a car title loan on time, you will prove to credit rating companies that you can effectively pay off a loan.
In turn, this will help your credit rating to improve.