This Article is About
bad credit rating
financial foundation
reputable company
credit score
job application
best foot
first house
medical bills
big trouble
background check
creditors
judgment
credit report
How To Fix A Bad Credit Rating
Join 1000's of Authors at StreetArticles Today!

How to Fix A Bad Credit Rating

Why credit is so important?

I'll tell you why. Whether you want to buy your first house or whether you want to buy the house of your dreams you will need to be financially sound as you go through your life. In order to create a structure a strong financial foundation, it will require that you learn about 5 C's of credit.

If you're looking for a job, especially in today's job market you will want to put you best foot forward where your credit is concerned. Employers have gotten to be very picky about who they hire. One of the thing they will look at is your credit score.

I'm sure you seen it on most job application where they ask permission to do either a credit check or a background check. Don't be misled by this request, just know today when companies ask your permission to do a background check it will entail a credit check, too!

When they view your credit, what the report will reveal to your potential employer is what kind of person you really are. Keep in mind they really don't know you and in order to make the best decision possible using your credit report will help them make a better decision.

You may have an outstanding interview, but really what it comes down to is what you look like on paper or what does your credit report reveal about your character? I need to be blunt here if you have a bad credit rating you are in big trouble!

I'm sorry to say, but it doesn't matter whether you've lost your job, or whether you have medical bills up the butt! All that really matters is your character. Your credit is a way that anyone can make an assessment about who you are as a person.

I use to hear the term 'dead beat' and attributed that term to people who didn't pay their child support payment. What I have learned in my research about credit and how to improve it. Creditors make a judgment about you based on your credit score.

With this information they will determine whether you can get insurance. If so, whether it will be from a reputable company or will it be from a substandard insurance company. It will also determine what interest rates you will be charged. There are a lot of bad drivers in the world who have good credit.

What You need to know about the 5 C's of Credit

When you learn the 5 C's of credit and what it can mean to you, you will arm yourself will tools that will benefit you throughout the rest of your life.

(1.) Cash - Which can sometimes be called capital is the total value of everything that you own. Can all be called your net worth. Net worth is arrived by subtracting total assess minus liabilities.

(2.) Cash Flow – Is determined by how much money is coming in on a consist basis. It can be determined daily, weekly, monthly, and yearly. Do you have more month at the end of your money?

Then you are experiencing what is called a negative cash flow situation. When you make more than you are spending, then pat yourself on the back, because you are enjoying the fruits of your labor and you are having a positive cash flow or what creditors love which is called Capacity.

(3.) Collateral – When you pledge a specific property such as a (mortgage, car, etc) as security for a loan. Bottom-line, if your fail to make the payments the creditor can force a sale of the item that was use as collateral.

Another form of collateral is your reputation. Your brand if you will just like Pepsi is a brand. Your reputation can be used as a form of collateral in the financial community. Another reason why your credit is so important.

(4.) Character References – You have complete control over your character. Creditors will look at your character that you developed or your reputation. A great what you can build your reputation is by asking for references from anyone you know.

Whether it be for trade or character references it is all tied to your character. You can develop your reputation when it comes to your finances. I would suggest you begin with the people that you normally do business with.

It could be your doctor, dentist, chiropractor, people who can attest to your character and how you pay your bill for their services. This is a great way to develop your own creditability. These things that I'm suggesting to you will not show on your credit report.

But, if you will put these character references in a binder, it will come in handy when you are attempting to persuade a banker in your favor when seeking out a loan. Another benefit you will gain from having a binder like this is, it is an ego booster.

Periodically leaf through the pages of your character references and you will feel really good, because you took the time to build your reputation, and you have good will with a lot of different people.

If a banker had to make a decision between two candidates with the same credit scores, how will he make the best choice for his bank? If you've given him your reference binder who do you think will get that loan?

(5.) Conditions – Whether it's the local economy, global economy, or national economy just be observant of what's going on around you. When you approach a banker for a loan, if will weigh heavily in your favor if you can talk about his concerns.

Are there foreclosures that the bank owns in the area? Speak to him about it. Tell him that you can imagine how hard things must be for the banks right now. Contrary to what people think, banks do Not want foreclosures on the books. When banks have to take back a property it is considered a dead asset.

Banks are penalized for having dead assets on the books. It means they can't loan out any money. If you can address your bankers concerns and make him feel that loaning you the funds necessary would be a win-win for him, then you just may tilt things in your favor.

Having that character reference binder can help cement the deal for you. Just knowing the 5 C's of Credit you are now armed with a tool that is very valuable. Can you see why it is so important to fix a bad credit rating?

Can you see why it is really a necessity to improve your credit rating? Don't put it off any longer! It is not impossible to fix a bad credit rating. But, it will require some effort on your part. Are you up to the challenge?


Street Talk

Are you a co-signor on car loan, mortgage loan? Has it brought your credit rating down a bit? Here is an excellent tip, how you can enhance your credit score.

Reply
  about 1 decade ago
You May Also Like
Top 10 Bad Credit Rating Repair Tips
#1. Get Organized Credit can be a simple process. We as a society have made some stupid choices when it comes to credit. Then after having made those choices, then we want to stick our head in the sand and act as thought nothing has happen. When nothing could be…
By:  in  Finance  >  Credit   Jan 05, 2012  
1
  Likes: 3

Credit Score And Sacramento Homes For Sale
Keep in mind that credit scores play a very important role when you are in the process of finding a house and lot in Sacramento region. You need to have a good credit rating if you want local banks to allow you to get a loan which you will be…
By: David Yaffee in  Real Estate  >  Buying   Jul 12, 2012  
0
  Likes: 1

The changing world and how to survive!
In to days world when it comes to having a pick of your job it can be sometimes very difficult. A decade ago people would agree with me based on the wide variety of jobs people could choose. Today most would blame the economy and jobs going overseas. When I…
By: lucas1 in  Writing and Speaking  >  Creative Writing   Oct 18, 2011  
0
  Likes: 0

Making The Move To Spain
Your mind is made up and you are going and it's time to get organised, it all looks a bit daunting at first so many things to do and so many people to see before you go. Well don’t get in a tizzy stay relaxed and just do one thing…
By: pam in  Travel and Leisure  >  Adventure Travel   Jul 13, 2011  
0
  Likes: 0

What Does My Credit Score Mean?
OK, you’ve done your homework and obtained your credit report and FICO credit scores from the three major credit bureaus (Equifax, Experian, and TransUnion). You have all the data on your credit history and the three-digit credit score numbers. So what does it all mean? Let’s discuss how creditors view…
By: Ron Estel in  Finance  >  Credit   Jan 09, 2012  
0
  Likes: 6

Fix Your Credit Score - I Have My Credit Report What Next?
Once you obtain your credit report you will able to add, correct and delete any information which is incorrect, incomplete, remove negative account that are out of date or the result of identity theft, according to FACTA law. If you have a hard time understanding your credit report. Instruction and…
By: DJ. Cameron in  Finance  >  Credit Tips   Mar 06, 2012  
0
  Likes: 2

Restoring Your Credit Report And Rebuild Your Credit Score
It can take three to 12 months to restore your bad credit. However the time you spend restoring your credit it is well worth it and the benefits you reap are priceless. Since the applying for loans have become everyday more difficult to obtain not to mention credit cards. If…
By: DJ. Cameron in  Finance  >  Credit   Apr 18, 2012  
0
  Likes: 1

How to Fix My Bad Credit Score the Easy Way
Did you know that 1 in 4 credit reports contains errors or omissions? And if it goes undetected can hurt you financially. Think about this for a moment. If the studies are correct and statistics say that they are then that means 1 in 4 people have a bankruptcy that…
By:  in  Finance  >  Credit   Jan 05, 2012  
0
  Likes: 2

Companies to Use to Check Your Credit Score
Knowing your credit score may come in handy for a lot of different reasons. Whether you’re trying to get a loan, or you’re trying to land a new job your credit score could affect it in either a negative or positive way. It is advised, that everyone check their credit…
By: Pammy Ewell in  Insurance  >  Personal Property   Oct 13, 2012  
2
  Likes: 2

Repair Credit Score - 5 Steps to A Healthy Credit Score
Good credit management practices that can help raise your credit score over time depends on how consistently you paying your bill on time, you keep your credit card balance low and apply for or open new accounts only as needed. Today we are going to learn 5 steps to a…
By: DJ. Cameron in  Finance  >  Credit Counseling   Mar 09, 2012  
0
  Likes: 2

Insane Interest Free Periods
I firmly believe the credit card firms should be held accountable to some degree for consumers Now, in theory, these are fantastic, IF you are disciplined enough to use it ONLY for that duration. Nowadays we are seeing up to 40 months interest free options, that's more than 3 years!…
By: Dave Page in  Finance  >  Credit   May 28, 2016  
0
  Likes: 0

Benefit Of Getting Easy Personal Loan In Singapore
In the past years, it may be difficult to take out a loan from a bank. But now, it is easy to get cash help from the money lenders. If you are faced with personal financial situation, it is important to find a good lender. The benefits of getting easy…
By: creditexcel1 in  Finance  >  Credit   Apr 18, 2016  
0
  Likes: 0

Seamless Chex: Your Fastest Way To Accept Check Payments Online
Do you want to have your check processed in a shorter period but can’t find any bank to do it for you? Worry no more because here comes Seamless Chex that provides a faster way of check payment processing. In as quickly as 60 seconds or less, you can already…
By: Ryan Steyn in  Finance  >  Credit   Apr 15, 2016  
0
  Likes: 0

Credit Repair to Get the Clean Chit for the Credits And Loans
When we plan to make the make the payment using someone else’s money is in simply terms a credit. Whenever a person applies for a loan or mortgage or even a credit card, it is the fact that they getting the borrowed money from someone who has deposited the money…
By: Smith Davidson in  Finance  >  Credit   Apr 02, 2016  
0
  Likes: 0

Born2invest As A Storytelling App
There’s something classy about the Born2Invest app. It’s neat, simple, and professional. Unlike any of its competitors, it is deprived of useless web elements typically found in a content curation app. “It is very undemanding and navigable,” said one tech journalist during the app’s official launch in Manila last July.…
By: Arturo Garcia in  Finance  >  Credit   Mar 11, 2016  
0
  Likes: 0

Article Views: 2550    Report this Article