Well, I assuming you can’t pay your debts on time! as result your debt increase more and more! and as you already know, every time you make late payment, or bad management dealing with debt , your credit score will decrease more further! as result you have poor credit score ! if you in that position, actually all you have to do is fix or cut the biggest spending!
for example, you have 3 credit cards, each cards you must pay about $200 so your debt are about $600 every month! meanwhile your income only $ 1500! you must pay other bills about $400, and $500 for meal allowance! for sure, you are in bad situation! because for most people usually they need some money to save just for in case if anything urgent happen! but for people that don’t have money, for sure they are in bad situation! sure, you can survive for 6-12 month! but after that! at some point it will break!
so the question is what to do, so I can keep some money for emergency ? well, first of all you don’t need 3 credit cards! because it will make you broke for sure! if you have debt on that 2 cards, pay full and closed that cards! and keep 1 credit cards to improve later! if possible try to tighten your bills! from $400 to $300! and if you can or have some skill try make money with that!
Most of you must be wondering, what’s corelation between money management with bad credit score ? 😀 well, for sure most people that have bad credit score basically most of them are quite smart people 🙂 but since the situation are not good, or have less money and can’t pay debt! as result your debt are out of control! and the effect for people that have less income but still have credit cards to pay, at some point they will make late payment! But if you have decent incomes! for sure, you’ll not late to pay your bills! and your credit score will remain strong and you’ll have good credit scores! in short bad credit mean, you can’t afford to pay your debt! as simple as is that!
If you read more carefully about FICO scores, basically their algo are not how much your financial capacity is! instead, they focus on trust! in short if you never late to pay CC bills, already have long history with some of them, your credit usage are less than 50% credit limit, and also you always pay other loans on time! if you do this 4 things and maintain this situation for 6 month or 1 year, for sure your FICO will high!
So, here my suggestion to fix bad credit! don’t use credit cards if your spending will not make any profit 🙂 if you want to buy something or shopping at mall use real money or cash 🙂 and to be honest with you guys, it doesn’t matter how much your limit is! and how many your credit cards that you have! and what credit company is! and if you think having a lot credit cards from top company that have high limit such as $100k USD for each card, will make you look like a rich people! forget about that stereo type! 🙂 because for long run, it will lead you to high debt!
just took 1 credit card that have low interest rates! if you can find another company that can give much better APR such 5-6% then stick to that cards! and find profitable business! 😉 repeat and rinse! I can guarantee if you do this properly, your credit score will be excellent! 😀 and hundreds of credit cards company will give you an offer! but unfortunately most of them will give you bad offer! 🙂