aims to increase the credit score on the credit report of a person. The financial health of individuals is determined by their credit scores. The crediting institutions look at them and assess whether the personís credit history does not pose a risk for them. For this reason, it is essential to maintain a good credit rating, which is placed on a scale from one to nine by the credit-reporting companies.
Negative marks are kept on oneís credit report for up to seven years. However, individuals with low credit score can undertake a couple of steps to improve their credit rating. Firstly, they can request and obtain their credit reports free of change from the major credit bureaus in Canada: Equifax and Trans Union. They should subsequently examine the report for possible errors such as dues that have already been paid off. In addition, there might be negative comments from various companies with regard to goods and services that were purchased far back in time.
Secondly, persons with low credit scores should get in touch with one of the credit bureaus and inform them of the errors contained in the report. They should enclose copies, not originals, in order to substantiate their position. Their letters should clearly state the facts and the justifications as to why the information in question is incorrect. The bureau will investigate the disputed items within a period of thirty days. In addition, the bureau will forward the letters to the bodies that provided the allegedly incorrect information. These organizations are required to complete their own investigations. If the dispute is not resolved in favor of the clients, they may still request that a statement of the dispute is enclosed in their file for future reference.
Thirdly, individuals with low credit ratings can repair their credit scores if they repay a portion of their dues. They should request from creditors to make a note on their credit reports that the debts have been discharged. Some creditors may be unwilling to grant new loans
if persons have already accumulated high levels of debt. The only adequate solution is to pay oneís debts, as much as possible, before filing an application for a new loan. It is best to focus on those loans which have higher interest rates. Debtors shall repay debts with lower interest rates afterwards. If the amount of the debt is larger that what they can reasonably pay, debtors should look at other ways of managing their debts. It is recommended to pay off all high interest credit cards and limit oneself to just one. Another option is to apply for debt consolidation loan
which reduces the amount of the debt. Persons with multiple debts can request consumer credit counseling or come up with an adequate debt management plan. They can opt for debt settlement with the creditors, using the assistance of a credit counselor. Finally, individuals who have extremely high levels of debt can formally initiate bankruptcy
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