Free Debt Management & Bankruptcy Articles

Professional Authors - Professional Articles

Debt Management Advice - Understanding Credit Scores

Having a bad credit score is just about everybody’s worst finance nightmare and something that we all wish to avoid. It gives the impression that you are not to be trusted (with money anyway), and nobody wants to hear that about themselves. Appreciating that good credit scores are based on trust and keeping (financial) promises means that there are ways of improving less than optimal credit ratings.

There seem to be a lot of stories going around about how a debt management program can hurt your credit scores. Usually, if you have a bad credit score this is something that is a result of not paying your creditors - not because you are involved in a debt management program. The debt management program is a symptom of dealing with the problem, not the actual cause.

When you already have a bad credit score going into a debt management program it is good to know that it can really only get better. When you join a debt management program the agency which assists you reports this. It can actually be evidence of your willingness to commit to and follow a payment plan to rid yourself of liability to creditors. If you are able to show you are trustworthy by meeting your monthly payments and maybe even paying some extra, they can report you as a good willing payer which effects your credit score in a positive way.

Although it can take a very little time to completely destroy your credit score, it can take a long while to restore it. Once a negative report on your payment behavior has been made, it stays there for seven years. Even though your credit score in numbers goes back up if you are sensible about paying out the debt, a negative comment may remain. Of course once you have shown that you are a payer that sticks to the deal that has been made, the negative credit history will be positively influenced.

Getting into business with a debt management company, or taking out a consolidated loan might result in reduced interest rates and lower payments allowing you to better meet your monthly obligations. This will in turn reduce the amount of time until you are completely debt-free which, of course, is good for your credit score.

As stated above, joining a debt management program isn’t of itself a factor which will negatively influence your credit score. It is merely a consequence of the debt that has led to your low score in the first place. However, faithfully participating in a debt reduction program which leads to payment of all your creditors in fact it can have a positive effect on your credit score.

In order to keep track of your credit score and be on top of your credit reputation it might be an idea to join a service which provides you with information about your credit. Then you can check where your rating is up to every now and again to know exactly where you stand.

Marvel Prescott   commented on 30-Aug-2015 11:55 PM
We are one.

Cynthia Burkhart commented on 07-Mar-2017 07:45 AM
Car insurance premium is always a considerable sum no matter how cheap your car was in terms of its cost.

Post a Comment

Captcha Image

monthly bill debt teaching children finance investing debit card credit score payday loan companies account interest cancer receipt creditors debt collectors debt collector help prioritizing making payments lending companies bad financial decisions paycheck unexpected expenses money home equity loans part time job extra money younger children consumer lawyer child support debt spend money mortgages borrowing budget payment behavior paying out debt budgeting emergency savings account debt consolidation loans common debt traps salary installment plan financial security down payment overbearing bills good credit building debts interest loan harassment family budget unreasonable expectations need money bank negotiation seperate accounts domestic support hobbies second job management advice debt programs taking responsibility bad debt interest rate telephone bills software budget ideas regain control management program past bad debt implement a budget whole family lending company court appearance Consolidation Company lose your job installment plans internet short sale monthly payment live your life losing your job original creditor become free liability high interest rate live within means pay off bill debt company worksheet credit card great budget credit credit card traps bills full details allowance classify bills good credit record rent payments debt solution total balance get out of debt visualization honesty invest money specific budget categories social services loan amount home equity household items asset info piling debts interest payments loans loss of income budget categories repay take control of debt secured loan interest rates family assistance help with debt debt free unsecured loan ill health finances debt management mistakes initial research your rights cable bill restrict spending modified payment plan credit bureaus credit reports help common debt purchases careful handling loan companies mortgage payments children budget cash child support stop harassment borrower paying bills credit rating credit companies pay off debt debt traps assets professional debt relief Chapter 13 debt management tips good credit rating phone calls credit card help medical bill overspending credit checks discounts credit company debt relief agency management tips gambling problem school jobs flat broke expenses personal finance debt management credit report debt settlement back support introductory offers good debt payment frequency sickness loan agents savings tax info filing bankruptcy credit repair learning experience account fees less money save money purchase protection children saving great budget ideas extra payments hospital losing a job credit line new job debt management advice repayment plans security candidate spending government assistance income comfortable living charitable organisation checks bad debt management house loan debt problems credit accounts account charges trusted friends gambling debts illness credit scores unemployed saving legal action ongoing bills loan rebuild good credit managing debt tracking money personal finances credit card company payday loan injury chapter 7 job loss paycheck info check card debt collection agency deb consolidation negotiate credit card companies more income credit history control spending bank accounts understanding utility payments debts deals in writing budget sheet medical bills checking account cash card insurance repay loans reduce debts buying a house understanding home equity groceries overcharging debt consolidation medical debt car loan fly-by-night monthly payments doctors home debts financial education insurances credit limit bankruptcy own money borrow money order report savings account monthly budget good budget debt consolidation handling money child spending debt payment period saving money low interest education credit cards credit card debt

Copyright 2016 - Free Info Site Enterprises
Privacy Policy  |  Copyright Policy  |  Website Use Policy  |  Non Endorsement Policy  |  Contact Us  

Finance Blogs
best blogs