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Completing a debt settlement program is an important step in improving your financial outlook. However, once the program is complete, you may be unsure of the next steps to take. After settling your debts, you will need to focus on two main goals. The first is saving money. Since much of your debt is paid off, you are in a good position to begin saving.

The second goal is to rebuild your credit. Debt settlement can have a negative affect on a person’s credit. The period that you spent struggling before enrolling in the program probably had a negative affect as well. To put yourself at a great financial advantage, you will need to improve your credit score.

How to Begin Saving After Debt Settlement

Instead of opening a regular savings account, you may want to consider opening a money market account or obtaining a Certificate of Deposit. A money market account is similar to a savings account, but will offer a higher interest rate. To open a money market account, you will usually need to make a deposit of at least $2,500. In addition to the high minimum balance, you will also be limited in the number of withdrawals you can make each month. Fortunately, if you decide to withdraw your savings from the account, you may do so penalty-free.

A Certificate of Deposit, or CD, is a deposit that you make for a specific term. CD’s also offer higher interest rates, but will usually penalize you for withdrawing your money early. CD’s are most suitable for consumers that have a long term savings plan, since they offer very limited flexibility.

Two Ways to Rebuild Credit

Once you’ve started saving, it’s time to think about your credit. To begin increasing your score, you will have to obtain new forms of credit. One of the easiest ways to do this is to apply for a gas card or a department store credit card. These credit cards are easier to get approved for, even with a damaged credit score. After opening one of these accounts, make sure to pay your bill on time and refrain from using over half of your available credit. After working so hard to pay off debt, you will not want to begin accumulating other large debts.

When entering the buying real estate arena your credit rating needs to shine in order to get a favorable credit rating. The difference of just a few points can mean the savings of thousands of dollars over the course of thirty years. By taking these knowledgeable steps towards building your good credit, you’ll be on your way to purchasing real estate and on the road to financial freedom!

It’s a good idea to make it a habit of checking your credit report on a monthly basis. It may be a mess right now, however once it’s cleaned up…it should only take ten minutes or so to make sure no surprises have came to your report. Another good idea is to make sure you don’t have to many consumer credit cards.

It’s better to be maxed out on one card than to have various amounts scattered across many credit cards. Paying only the minimum due is no good! You’ll never get them paid off that way. It’s not unusual to still be making payments twenty years down the road.

Charging up your cards more than you can afford is bad news! Stay within your budget. Your credit will take on a life form of it’s own into an uncontrollable snowball. Paying a day or two late will only cause unnecessary late fees and often raises interest rates.

Most of the wrong information you find can be easily corrected online within a few days. If you find something you usually can make note so the bureau can do a research on it right away. You do want to keep in mind your not just making corrections on one credit bureau. You need to look at all three.

Bad business practices is to ignore credit problems. When digging in your report and you do find a blemish attack it head-on with credit bureau. Make sure you check over your report again after they contact you saying they’ve made corrections. I can’t tell you how many times I’ve found more errors when my corrected report was sent back to me!

If you’re turned down for credit, you have the right to know why. The law says that creditors must give reasons and the name and addresses of which credit bureau gave you the negative mark. You have the right to request a copy without charge from the bureau that caused you to be rejected. If you can show the errors then contact that bureau once again and explain the problem. Once it’s fixed the bureau will contact you with the results.

Want to know how to establish good credit fast? Are you worried about being turned down for a loan at the bank? Use the following 4 tips to get good credit with your lenders…

As a consumer it’s important that you have a good credit rating with lenders. Poor credit can keep you from owning a home, buying a car or getting the lowest interest rate available on your loans. Your credit worthiness is established by your credit score so it’s important for you to establish good habits early on.

If you follow these basic principles when starting out you’ll have a high credit score and never have to worry about being denied for a loan.

1. Pay Your Balance In Full And On Time
2. Don’t Use Too Many Credit Cards
3. Don’t Max Out Your Card
4. Pay More Than The Minimum

Pay Your Balance In Full And On Time

Lenders use your payment history to determine if you’re a potential high risk. If you’ve been responsible in paying off your debts in the past, chances are you’ll pay off future debts as well.

Lenders want to see that you’re responsible and because a large chunk of your credit score is determined by how on time your payments are, paying your account in full and on time increases your score.

Don’t Use Too Many Credit Cards

When you’re starting to establish your credit you’ll have multiple credit card offers coming you’re way. Start with one card. By having a single card, you’ll be able to manage your debts easier and make your payments in full and on time.

Having too many cards can send up a red flag to your lenders that you might be high risk and unable to pay back your debts on time.

Don’t Max Out Your Card

If you have cards that are maxed out chances are you’re having difficulty paying down your balances. In order to increase your credit score you shouldn’t use all the credit that is available to you.

The amount of credit available vs. how much debt you owe on your card is called your credit to debt ratio. If possible try and keep this below 50% or better yet 30% if possible.