Tax Season – Best Time to Repair Your Credit Score

Why is tax season the best time to repair credit? As important as credit repair is, this process repeatedly slips to the bottom of many people’s to-do lists. They make excuses, telling themselves that it’s not quite the right time to get around to addressing credit issues.

If this situation sounds familiar, there’s good news. Tax season is a great time to take strides toward resolving your credit issues and improving your FICO score. Take a look at why you should seize this opportunity to improve your financial future.

Financial Issues Are Already On Your Mind

Whether you’re doing your taxes yourself, hiring a tax professional or using tax preparation software, the tax filing process requires you to evaluate your overall financial picture. Many people with credit issues find that this first step toward credit repair can be the most difficult part of the process.

Because you’re already taking stock of items such as your earnings, loan interest, charitable donations and expenses when you do your taxes, this is the perfect time to continue that process and delve deeper into your financial picture. While you’re researching and calculating, add up your total debt, take stock of your debt payment history, order copies of your credit reports and review them. Create an organization system for all of this information so you’ll have an easier time keeping track of your progress as you work toward improving your credit.

Daunted by the idea of tackling it yourself? Gathering all your records can also be the first step you take before turning to a professional credit repair company that can put you on a better financial path.

You Can Get a Head Start at Paying Down Debt

If things go well, tax season means you should receive a tax refund. While it may be tempting to spend that money on a new purchase, a few nice dinners or a vacation, it’s a better idea to put the cash toward improving your credit score.

If unpaid debt is one of the issues that has contributed to your less than ideal credit score, putting your tax refund toward one of those outstanding balances can be a significant step in the right direction. Don’t fall into the trap of getting discouraged if your tax refund is only a small portion of your total debt. Every little bit helps and puts you closer to your financial goal of having less – or no – debt weighing you down.

Using your tax refund to pay down debt can also inspire you to use future lump payments to cut back on debt. This small effort could be the first of many tax refunds and bonuses that go toward chipping away at your debt and making a big impact over the long term.

You’ll Eliminate a Common Barrier with an Emergency Fund

Maybe you’ve tried to repair your credit in the past, but you were thrown off track by an unexpected car repair bill or health expense. One of the main reasons people continue to damage their credit score is because they aren’t prepared to handle emergencies like these.

If this situation sounds familiar, you can use your tax refund to create an emergency fund. This will give you more security and flexibility to improve your FICO score without your having to worry about getting sidetracked by unexpected expenses and financial setbacks.

You Can Invest in Professional Credit Repair

If you’re not sure where to start when it comes to fixing your credit – or if you feel that you simply don’t have the time to research credit repair strategies – consider using your refund to invest in credit repair services. Credit repair professionals offer services that include disputing erroneous items appearing in your credit history, providing personalized advice for your particular situation, closely tracking your progress and ensuring that you stay on the right track even after you’ve achieved a good credit score.

If you have a large enough tax refund, you may have enough money to invest in affordable professional credit repair and still have money left over to put toward other uses. Even if you feel confident in your ability to repair your credit on your own, using a credit repair company gives you access to resources that can significantly speed up the process.

Now is Always the Best Time

Perhaps the best reason to address your credit during tax season is that putting off this important financial step can have several negative consequences. For one thing, it takes time to fix poor credit, so when you put off addressing the problem, you’re delaying that positive outcome. Regardless of what your finish line goals are – purchasing a home or freeing yourself of bad debt – you’ll reach that finish line sooner if you take the first step as soon as possible.

There’s another major problem with procrastinating when it comes to fixing your credit. Bad credit costs you money. Individuals with poor credit are charged more in fees, interest rates and deposits. The longer you wait to repair your credit, the more unnecessary expenses you’ll incur. Hold on to your hard-earned cash by starting to build a better credit picture today and paying less in unnecessary charges and fees.

Tax season can be a pain for many people, but it can also provide a timely opportunity to evaluate and improve your credit situation. No matter what stage of the tax-filing process you’re in, take the time to carry out these extra steps so you can embark on a rewarding journey toward better credit and a better financial life.

Debt – Good vs Bad

We are accustomed to perceive of debt as 100 % derogatory. And also, it can make sense: all financial obligations, regardless of the kind, can be bad number in your possessions, lowering your family’s net worth. Yet, the comprehensive review is not that simple. Some forms after a while, will aid the stability, your possessions as well as your ability to earn money. A few typical kinds of financial obligation and their impact on your economic well-being.

Home loans

Without a mortgage, you are not able to actually take advantage of the real estate market. Mortgage is reasonably low-interest lending that can permit you to develop equity & your individual monetary declaration in time.

As your wide range increases, your monetary ability might increase too. With the majority of routine payments and also a normally cherishing real estate market, a residence can permit you to build a protected location to retire or a nest egg to make use of toward your retirement destination.

Of course, not every home mortgage situation is constructed alike. If you bought a couch throughout a time of high real estate prices or obtained a finance with a changeable rate of interest, you might end up with a property that deserves much less compared to you owe. Always study lasting fads and research your home loan contracts very carefully prior to you dedicate.

Sallie Mae Loans

It utilized to consistently be presumed that pupil financing were good debt due to the fact that they resulted in a greater paying occupation. But, enhancing education and learning costs and also transforming work markets mean that it should be participated in meticulously.

Study increasing fields to make sure that your degree will certainly result in the very best feasible job leads. In general, college grads gain greater than those that lack degrees. Yet, majors and the areas where you eventually prefer to live will identify exactly how important a student loan is as an investment in your future.

The “Worthless” Bank card Financial obligation

Vacations, clothes, precious jewelry as well as technical playthings is almost always an unfavorable. These things are almost never possessions that will expand in value. Whenever you would like to purchase something on credit, ask whether you have the money to pay the financial obligation off completely when your bank card declaration comes. If the solution is no, carefully take into consideration whether future you would certainly enjoy living with less money because you of today would like to splurge.

Car Lending

Automobile finances are another group of lending that, generally, will not assist you construct your net worth in time. However, there are a couple of various other factors to consider that can make them worth your while. If you live much from your task and also require an especially reliable auto, a car loan can be rewarding. It might enable you to get a newer model, which improves your job protection. Additionally, if you are in the procedure of rebuilding your credit rating, an installment financing could assist enhance your score. Simply make sure that you choose a funding with inexpensive settlements that has no charges for prepaying as well as will offer you the possibility to make adjustments as your credit report enhances as well as you increase your monetary worth.

While most of us can not live completely debt-free, there are significant distinctions between just what is considered “great” financial obligation as well as “bad” financial obligation. Though some financial obligation come under a bit of a dirty location, great financial obligation is merely specified as money obtained to spend for choices you really need or that value in worth, and also uncollectable bill is built up for products you simply really want and that usually drop in worth.

A write-off is a quantity owed by a company that is extremely unlikely to be paid due, for example, to a company entering into liquidation. There are numerous technological meanings of just what makes up a bad financial obligation, depending upon accounting conventions, governing procedure as well as the establishment provisioning. In the U.S.A, bank loans with more than ninety days’ defaults end up being “trouble financings”.

For more information about how charge offs can affect your credit score you can contact one of our team members. We would be happy to help you challenge those records that are no longer collectable per the FDCPA. The consumer has rights. But you must choose to exercise them.

Apartment Rental Application – How Credit Matters.

Paying Cash

Every now and then, you encounter someone who says that they don’t need credit because they pay cash for everything and they don’t want to buy a home. No mortgage, no credit cards, no need for credit, right? Unfortunately, this view is dead wrong. Your credit score comes into play in a lot of agreements: job offers, insurance rates and, yes, apartment rental applications.
Your Apartment Rental Application & Credit

Apartment Rental

When you put in an application for an apartment, chances are high that you will be asked to submit to both a background check and a credit screening. While they will be most concerned with your rental history, particularly whether you have ever been evicted for non-payment, they’ll take a look at other areas, as well.

Because of the bad economy, many landlords are hesitant to rent to people who have historically had problems paying their bills. It makes sense; if you are unable to pay your rent, they wind up losing thousands of dollars.

This is why building a history with positive records of credit use is imperative. Even if you never want to borrow, you will still wind up in situations where people are taking financial risks on you.

Can You Rent with Bad Credit?

The answer is yes, with some conditions. While you may have some trouble negotiating with large rental companies, they are usually not the only options in most areas. To mitigate the issues of bad credit when renting:

Look for privately-owned properties. If you are dealing with a person who owns a small apartment building or has a house that she rents out, your chances of having to undergo a credit check are lower. Plus, you have a chance to personally explain any smudges on your credit.
Offer a larger deposit. If you have the cash to do so, offer a larger security deposit. This can give a potential landlord peace of mind.
Offer to have rent automatically deducted each month. If your rent is withdrawn automatically from your checking account each month, the landlady does not have to worry about whether you remember to pay the bill.
Work on emphasizing your best features. Have you been at the same job for several years? Are people you rented from in the past willing to give sterling references? This can help.
Get a co-signer or roommate. If you have someone with stronger credit who is willing to vouch for you, it can help stack the odds in your favor.

Work on Fixing Your Credit

While it is possible to rent with bad credit, it’s easier to rent with better credit. Look at your credit report to find the areas where you can most easily improve. Everything from taking off erroneous black marks to building credit history with a secured card can help. Over time, as your credit gets better, you will find that your housing options improve.

For more information regarding our credit repair program please click here to request a free consultation.

Tag: credit