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6 Ways To Defeat Bad Credit Score

6 Ways To Defeat Bad Credit Score

Know in advance: it won’t be easy. Improving credit scores are not immediate, and will require a hefty length of time to fix. This is because lenders, institutions, and issuers evaluate your past years’ behavior and actions, taking your entire credit history into account.

Not everyone has great credit, and there’s no shame in that. Of course, life happens, and there are circumstances some people genuinely cannot avoid. It’s a tragic credit scenario that’s happened to many people.

A typical business scenario is in the construction industry where surety bond come into play when contract price exceeds $100k.

“A surety (insurance company) bond is necessary to make sure that business owners (principal) performing the task follow specific requirements as laid in contract by the oblige (entity).”

Surety will weigh the risks of “taking you on” depending on your credit score – and decide whether or not your credit is worth the hassle of issuing you a bond or not. So, your credit score will determine the fate of your business.

If your credit score is above 750… congratulations! You have excellent credit. Any account below 650 is generally considered to be less-than-appealing to issuers and lenders.

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At the lower end of the spectrum, people around the 300-600 mark aren’t doing so well. Where do you fall?

Below are several ways to help you increase your credit score so you can get back in your lender’s good graces.

1. Check Your Score

Not knowing what is happening on your credit reports is like not knowing what you spend your money on. It is simply bad practice, and spells disaster for your bottom line. Be sure to check for free annual credit reports every few months or so and stay up to date.

Something to keep in mind when you’re reviewing your scores is to see how much revolving credit you have, versus how much you actually use. The lower the percentage – the better your credit rating.

Please be sure to see if your credit card issuer accepts multiple payments over the course of a month. Certain issuers report the balance on your statement to the bureau. So, if you pay full balances every month, only one balance will be actually reported.

2. Keep Calm And Relax

No matter how annoying it may be to see negative information every time you get your credit reports, keep in mind that this information often has less impact on your credit scores over time.

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Negative information on your reports have less impact on your credit scores the more time passes. Barrett Burns, CEO of VantageScore, states that just because information stays for seven years, doesn’t mean that information is relevant each year.

For example, let’s suggest you miss a payment (which probably happened – it’s sometimes impossible to keep up to date in today’s world). Your score may drop, but will take around a year and a half for you to recover fully – falling far short of the “7 Year Fear”.

In fact, it’s generally wiser to focus on your good debt (that is, debt that you’ve handled well and paid). Focus on your good payments, it will outweigh your bad scores. Keep in mind that bad scores are, well, bad, but they are not a doomsday scenario that many people make them out to be.

Credit card expert John Ulzheimer suggests keeping old debt and good accounts on for as long as they are possibly allowed. The takeaway: do not close old accounts, whether you have a good or bad score.

3. Don’t Open Too Many Accounts

Opening new accounts rapidly destroys your credit. This is because newer accounts lower your average account’s age – widening the overall effect of your scores. Not to mention that it looks risky to credit card issuers (to them, they think you’re a scam artist for opening up new accounts).

Plus, new accounts—in all likelihood—won’t raise your credit score.

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4. Don’t Close Unused Accounts

Regardless of your good debt, bad debt, and credit score, closing accounts won’t remove your bad debt. We can equate this to asking your high school to remove your grades from report cards.

Closed accounts still show up on your overall credit report, and do more harm than good, as it shows issuers that you’re unreliable.

Closing unused credit cards accounts is an ineffective strategy for raising your scores. It simply won’t. In fact, many people have had their credit scores lowered by doing exactly that.

5. Go Fully Automatic

One way of doing this is by setting up auto-payment, or payment reminders so that you never miss them. Similar to setting up automatic payment for bills to be withdrawn from your bank account on certain dates.

I personally have a hard time remembering important matters such as these, even in my daily life. I cannot stress enough how important weekend reminders (even daily reminders) via Google Calendar are.

If you’re wary of going fully automatic, build a schedule for yourself using task management software such as Trello or Asana. I recommend Trello, as it’s an intuitive and easy-to-use system for managing tasks and to-do lists. It fits my on-the-go needs and lets me adjust my schedule accordingly.

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6. Don’t Be A Risk

For whatever reason, whatsoever, do not risk damaging your score. This means trying your hardest not to miss any payment, or suddenly paying in smaller amounts, or infrequently charging more. Maintain a good score by being consistent with your payment dates and payment amounts.

However, taking cash advances might make your card issuer wary without hurting your score. Know this: charging businesses to your card that give second doubt to your money-handling abilities also paint you as a suspicious client.

Dave Jones, former president of the Association of Independent Consumer Credit Counseling Agencies (AICCCA) warns that you do not, under any circumstance, give the impression that you’re a risk. As with anything in life.

Conclusion

Managing your bad credit scores isn’t as troublesome as many people make it out to be. All it requires is a determination and will to make your payments, consistently, as you agreed you would; not presenting yourself as a risk; adamantly refusing the temptation to open several accounts or close old ones; keeping your sanity as you handle your credit score.

Featured photo credit: via pixabay.com via pixabay.com

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Last Updated on June 20, 2019

50 Businesses You Can Start In Your Spare Time

50 Businesses You Can Start In Your Spare Time

Most people want a few more dollars in their wallets. But between an employer and family, the time most of us can devote to a second job is severely limited. Running a small side business can provide a few more options: you don’t have to show up at a set time and you can use skills you already have. Not all will be perfect for everyone, of course, and I’m sure that you’ll have a few ideas of your own after reading this list. If you’d like to share any other business ideas, please add them in the comments.

  1. Selling collectibles — From antique books to teddy bears, there are plenty of opportunities to buy and sell collectibles. It’s important to familiarize yourself with the collectible of your choice but if you choose something that you’ve been collecting for a while, you’ve got a head start.
  2. Locating apartments — It can take time to sort through apartment listings, but you can make some money by finding the perfect apartment for a renter.
  3. Baby proofing — New parents often prefer to bring in an expert to make sure their home is safe for a new baby.
  4. Calligraphic writing — If you’ve got elegant handwriting, you can pick up gigs writing or addressing wedding invitations, holiday cards and more.
  5. Selling coupons — Search on eBay for coupons right now and you’ll see thousands of listings for coupons. It’s just a matter of clipping and listing what you find in your Sunday newspaper.
  6. Pet training — A surprising number of people don’t know where to start in training a pet. Even teaching Rover simple commands like ‘Sit’ and ‘Stay’ can bring in a few dollars.
  7. Running errands — A wide variety of people want to outsource their errands, from those folks who aren’t able to leave their homes easily to those who have a busy schedule.
  8. Researching family trees — Amateur genealogists often call in experts, especially to handle research that has to be done in person in a far off place. If you’re willing to go to a local church and copy a few records, you can handle many family tree research requests.
  9. Supplying firewood — The prerequisite for selling firewood is having a source of wood; if you’ve got some land where you can cut down a few trees, you’ve got a head start.
  10. Hauling — As more people trade in their SUVs for compact cars, hauling is becoming more important: people have to rent a truck or hire a hauler for even small loads.
  11. Image consulting — Image consultants provide a wide variety of services, ranging from offering advice on appearance to teaching etiquette.
  12. Menu planning — For many people, the trip up in eating home-cooked or healthy meals is knowing what to prepare. Meal planners set a schedule to solve certain dietary problems.
  13. Microfarming — Cultivating food and flowers on small plots of land allows you to sell produce easily.
  14. Offering notary public services — Notary publics can witness and authenticate documents: a service needed for all sorts of official documents.
  15. Teaching music — If you’re skilled with a musical instrument, you can earn money by offering lessons.
  16. Mystery shopping — Mystery shoppers check the conditions and service at a store and report back to the store’s higher-ups.
  17. Offering research services — Just by reading up on a topic and compiling a report on it can earn you money.
  18. Personal shopping — Personal shoppers typically select gifts, apparel and other products for clients, helping them save time.
  19. Pet breeding — Purebred pets can be quite value, especially if you can verify their pedigree.
  20. Removing snow — During the winter months, shoveling walks can still be a reliable way to earn money. You might be asked to take care of the driveway too.
  21. Utility auditing — As people become environmentally-concious, they want to know just how efficient their homes are. With some simple testing, you can tell them.
  22. Offering web hosting services — Providing server space can be lucrative, particularly if you can provide tech support to your clients.
  23. Cutting lawns — An old standby, cutting lawns and other landscaping services can provide a second income in the summer.
  24. Auctioning items on eBay — Want to get rid of all your old stuff? Stick it up on eBay and auction it off.
  25. Babysitting — Child care of all kinds, from babysitting to nannying, can offer constant opportunities.
  26. Freelance writing — If you’ve got the skills to write clearly, you can sell your pen for everything from blogs to advertising copy.
  27. Selling blog and website themes — Do a little designing on the side? Customers that don’t want to pay full price for a website will often pay for a template or theme.
  28. Offering computer help — Particularly with people new to computers, you can earn money by providing in-home computer help.
  29. Designing websites — It may require a little skilled effort, but designing websites remains a reliable source of income.
  30. Selling stock photography — For shutterbugs, an easy way to put a photography collection to work is to post it to a stock photography site.
  31. Freelance designing — Check with local businesses: you can provide brochures, business cards and other design work and get paid a good fee.
  32. Tutoring — Math and languages reamin the easiest subjects to find tutoring gigs for, but there is demand for other fields as well.
  33. Housesitting / petsitting — Stopping in to check on a house or pet can earn you some money, and maybe even a place to stay.
  34. Building niche websites — If you can put together a site on a very specific topic, you can put targeted ads on it and make money quickly.
  35. Translating — The variety of translating work available is huge: written word, on the spot and more is easy to find even on a part-time basis.
  36. Creating custom crafts — No matter what kind of crafts you make, there’s likely a market for it. Etsy remains one of the easiest places to sell crafts.
  37. Setting up a wi-fi hotspot — With a little bit of equipment, you can set up a wi-fi hotspot and charge your neighbors for the access they’ve been ‘borrowing.’
  38. Selling an e-book — You can write an e-book about almost anything and put it up for sale online.
  39. Affiliate marketing — If you’re willing to market other companies’ products, you can earn a cut of the sales.
  40. Renting out your spare room — From looking for a long-term roommate to listing your guest room on couch surfing sites, that spare room can make you money.
  41. Offering handy man services — Handling small household tasks can provide you with plenty of work, although you’ll probably be expected to have your own tools.
  42. Teaching an online class — Share your expertise through a website, an online seminar or variety of other methods.
  43. Building furniture — For those with the skill to create handmade furniture, selling their creations is often just a matter of advertising.
  44. Providing personal chef services — Personal chefs prepare meals ahead of time for customers, leaving their customers with a full freezer and no mess.
  45. Event planning — From planning corporate events to bar mitzvahs, an event planning business can require plenty of work and offer plenty of pay.
  46. Installing home safety products — Particularly as Baby Boomers age, people able to install handrails and other home safety products are in demand.
  47. Altering / tailoring — If your sewing skills are up to par, altering garments is coming back as people try to stretch more wear out of their clothing.
  48. Offering in-home beauty services — Hair cuts, makeup and other beauty services that can be performed at home have a growing demand.
  49. Business coaching — Helping others to establish and develop their businesses can provide many opportunities to earn money.
  50. Writing resumes — Writing resumes can provide a reliable income, especially if you can put a polish on a client’s credentials.

There are plenty of offers that claim to provide you with the opportunity to make thousands of dollars a week. Unfortunately, none of these businesses will provide that sort of income, but they aren’t scams either. They were chosen because they all require a minimum investment to get started — some require nothing more than a flyer advertising your business. Even better, if you do enjoy any of these businesses, there is a potential with most of them to continue to expand — perhaps even to the point of going full time.

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Featured photo credit: Omar Prestwich via unsplash.com

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