Building a Better Credit Report (Part 6)
What are my options for dealing with debt?
Many people face a financial crisis at some point in their lives. Whether the crisis is caused by illness, the loss of a job, or overspending, it can seem overwhelming. But often, it can be overcome. Your financial situation doesn't have to go from bad to worse. If you get into financial hot water, there are options: credit counseling from a reputable organization, debt consolidation, or bankruptcy. Which path works best for you depends on your level of debt, your level of discipline, and your prospects for the future.
Contact your creditors immediately if you ever have trouble making ends meet. Tell them why it's difficult for you to pay your bills, and try to work out a modified payment plan that reduces your payments to a manageable level. Don't wait until your accounts have been turned over to a debt collector. At that point, your creditors have given up on you.
Got bad credit? Steer clear of credit repair scams
You see the ads in newspapers, on TV, and online. You hear them on the radio. You get fliers in the mail, e-mail messages, and maybe even calls offering credit repair services. They all make the same claims:
Credit problems? No problem!
We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!
We can erase your bad credit—100% guaranteed.
Create a new credit identity—legally.
Do yourself a favor and save some money, too. Don't believe these claims: they're very likely signs of a scam. Indeed, attorneys at the Federal Trade Commission, the nation's consumer protection agency, say they've never seen a legitimate credit repair operation making those claims. The fact is there's no quick fix for creditworthiness. No one can legally remove accurate and timely negative information from a credit report. You can improve your credit report legitimately, but it takes time, a conscious effort, and sticking to a personal debt repayment plan.
U.S. Federal Trade Commission. (2014). Building a better credit report. Retrieved January 10, 2019, from https://www.consumer.ftc.gov/