Wahts the best way to repair your credit?

Question

I know the simple answer is to pay off your debt, but I have also been told by paying off credit cards and closing them that hurts your credit too. So whats the best economic pattern to follow.

Answer 1

Start by obtaining your credit report. Check for inaccuracies and dispute them if they are truly inaccurate. Pay down your accurate debt. Keep your accounts open, just pay down the debt to 30% or below the limit. For example if your card's limit is $100, only use $30 or less and pay it off, but keep the card active.

Answer 2

There are companies that also help repair credit for a fee. But first obtain CRA report showing your current defaults, arrears as this is what the Banks etc use to assess your credit.
Any default under $500 is generally disregarded and you should always be upfront and honest with the credit provider and tell them about defaults that are listed.

Economic Pattern - If possible get a credit card with a low introductory offer for transfers of existing debt and try to budget to reduce the debt within that period. Also remember to cancel the existing card if transferring debt as this may be too much a temptation at a later date.

Hope this helps

Answer 3

There are credit card specially designed for bad credit people, they are usually cards from Orchard, First Premier or Capitol One banks (at least they declare them to be so). You can try to accumulate your score with one of them.

Look here: