Page 36 - Life Coaching Today January 2021

The starting point to rebuilding and repairing your credit history is to make sure that you have a plan in place to settle your current obligations. You will find many tips online on developing a sound financial strategy to slowly but surely cut back on your existing debts. Anyone with a bad credit rating should spend most of their energy ensuring that paying current debt is promptly to have a starting point for their recovery. For the most complicated cases, there is value in employing professional financial advisors and credit counseling services to help you overcome your current predicament.
If you are unable to develop a workable financial plan based on the current payment terms of your existing credit lines, a debt counseling service can help negotiate a debt restructuring plan on your behalf. In straightforward terms, a debt restructuring plan refers to a negotiated agreement where creditors will allow you to change your payment terms to ensure payment in the long-term. Contrary to popular belief, most creditors are open to debt restructuring arrangements instead of the legal demands of a bankruptcy filing because debt restructuring offers the best chance of full credit payment despite the prolonged duration.
A debt consolidation strategy via personal secured loans is also a viable option that you must consider.Secured loans are loans that are guaranteed by a collateral asset. Property is often a standard option in the case of credit card debt. In the case of mortgage foreclosures, which is a likely consequence of a secured loan executed years back but is now unpaid, new loans with higher interest rates can become a final resort.
Where possible, do not opt to file for bankruptcy to escape your financial obligations. Many attempts to quickly address their problems via legal provisions that shelter those who have declared themselves bankrupt. However, such arrangements only serve to prolong your struggle towards repairing a bad credit score. Financial institutions and credit rating agencies are more likely to rate you better if you opted to restructure your existing debt or secure a debt consolidation plan instead of defaulting on your credit obligations.
Remember, the key to repairing your bad credit score is to start with your current debt. There is tremendous value in one's effort to resolve an existing debt situation because this can serve as a soundproof of one's intentions to turn their credit reputation around. Meanwhile, attempting to press the reset button for your credit problems via quick solutions like bankruptcies and defaults will only serve to extend your worries.
Devise a workable payment plan and stick to it to the end. If you show that you are on top of your problems and that you have an idea in place to take control of your situation, you are more likely to develop the habits required to maintain a good credit score. That, in itself, counts so much more towards reversing your unlucky financial streak and finally regaining the excellent credit standing that you have so valued all this time.