Sometimes I get questions sent to me through the email. Some questions are very specific and some a bit more universal.

I love when readers write to me!

Reader Asks a Question About Credit Reports

One question I received through email this week was about credit reports and scores. Here’s the gist of the question:

Should I pay [my] past due credit bills to better my credit?

I told him that paying your past due bills will slowly build up your credit. Past due accounts lower your score and it could look bad if you are thinking of getting a mortgage, car loan, or even rent an apartment down the road.

First off, I’d like to know where I’m starting from. You can do this by checking your credit reports.

Ordering Your Free Credit Reports

If you need to see what’s on your record,the Federal Trade Commission points you to the genuinely free link at annualcreditreport.com.

The three nationwide consumer reporting companies have set up one website, toll-free telephone number, and mailing address through which you can order your free annual report.

If you do not have Internet access, you can also call 1-877-322-8228.

See if there are any mistakes on your credit report and fix them. See what accounts are most delinquent and work on catching up with them.

Catching Up on Your Past Due Bills Helps You Raise Your Credit Score

Miranda Marquit wrote a post on this blog about the effect of debt repayment  on your credit score:

The largest consideration in your credit score is your debt payment history (35%). Do you pay on time? Do you always pay at least the minimum? Your credit score will take into account your payment history, and a reported late payment or a missed payment, on your debt obligations can have a big negative impact.

Because the credit score is designed to let lenders and creditors know how reliable you are when it comes to repaying your obligations, it is no surprise that debt is a huge factor. Indeed, the credit score is almost entirely designed around how you handle your debt.

Book Recommendations on Eliminating Credit Card Debt

If you’re in a lot of debt and need a step by step guide to build up your finances, borrow from your local library or buy Total Money Makeover by Dave Ramsey or  I Will Teach You To Be Rich by Ramit Sethi. these books have practical tips on eliminating your credit card debt.

I enjoyed reading both books and think they give concrete actions to help you with your personal finances. Read both and see which one fits you better.

What advice do you have?

Photo Credit: stefg

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