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This guest post is written by Alex Leigh.
Here’s a question I hear time and time again; Most people are of the understanding that if your credit history starts to go astray and you start missing payments then after a while you’ll end up on a Blacklist. Once you’re on this blacklist people imagine that it’s hard if not impossible to get off it and get back on the credit ladder once again. The thing about this however is that it’s simply not true!
You might be surprised to hear this and people often are, but even if you miss credit payments constantly and have loads of bad debts, there is simply no ‘universal blacklist’ for your name to go on! Some companies may keep their own bespoke lists of customers they don’t want to lend to, but they don’t share this list with other companies. This is not to say that you can have a terrible credit record and still be able to get access to credit at low rates – if this was the case, then we’ve have a lot less boom and a lot more bust!
Online loan provider Blacklisted Loans provide short term loans and guarantor loans that are targeted at the ‘bad credit history’ or sub prime credit markets. The reason they are called Blacklisted Loans is to fill this mis-conception that you end up on a blacklist if you don’t pay your credit on time, however, as I’ve explained, there is no such thing. What there is instead is credit history. Everyone who has had credit at some point in their lives will have a credit history and it’s essentially a record of all your credit activities since you were eligible to get hold of any! Everyone’s credit history is accessible from credit reference agencies; lenders can request your credit history from these agencies and instantly get a picture of how good you are at repaying debts. This is the reason why if you don’t have a good credit record, you don’t get accepted for low rate loans or credit cards.
The good news here is that your credit history can be repaired. There are simple procedures to follow that can get your credit past from looking terrible to being ship-shape once again. Here’s a basic outline of what you need to do;
1) Write to the credit reference agencies and request your credit record (you can usually do this online though Equifax or Experian)
2) Check your record for any errors or mis-reported information. Sometimes credit will show on your record that isn’t actually your own – it could be your partners or even previous occupants of your home. Make sure you request to have this removed.
3) Make sure you pay down as much of your existing debt as possible. Do this consistently and pay off as much as you can afford each month.
4) Apply for a credit card or loan designed for people with bad credit. Make sure you repay this credit each month, on time and if it’s a credit card, in full!
5) Once you have done this for 6 months or so, your credit record will already be in much better shape. Remember to maintain consistent payments and you will soon be able to borrow at top rates once again.
Remember, there’s no blacklists and there’s always a way out. If you’ve got debts and a bad credit record, don’t give up on trying to improve it.