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Everyone knows that another unfortunate effect to the already very long list of negative effects of credit card debt, is that blow to your credit rating. If you are currently in credit card debt, or once was deep in debt, you already know how badly it has impacted your credit history. The problem with having poor credit history is not merely the psychological or emotional stress it brings you, but the real very concrete effect on your ability to get further access to credit. If you have a poor credit history, you can be sure that you will have a hard time getting access to credit. Credit, in this case, refers not just to the credit limit on credit cards, but credit of all kinds, including bank loans. This is a serious problem since it will definitely limit your ability to make any major purchases, including buying a car or a new home. For this reason, any one who has a poor credit history knows how important it is to start rebuilding ones credit history. However, just as in many things in life, it is much easier to destroy ones credit history than it is to salvage and rebuild it. Nevertheless, you need to start somewhere if you want to get back the trust of creditors and get the access to credit you need. The first thing you need to do is make sure that you do no further damage to your credit rating. Start by sticking to your budget and sending in your credit card payment on time. This goes for your other loan payments as well. Next, you need to settle all your delinquent loans. This includes all credit card debts, as well as any other kind of loan. If the credit card balance or debt is more than 7 years old, it has ceased to appear on your credit history though, so just settle those that are less than that. The third thing you need to do is show that you can be trusted with managing your credit again. So apply for a new credit card and use it wisely. The best credit card offer you will probably get in this case is only one that has high interest rates, due primarily to your poor credit rating. This is not a problem since you shouldn’t be using it much anyway and should pay off your entire balance at the end of each month. Lastly, be patient. It will take time for your credit rating to go up sufficiently for creditors to trust you with their money again. Just continue in handling your finances more wisely, and you will reap the rewards not just in terms of credit history, but also in your overall financial health. Peter Carville is a freelance article writer who writes for Financial Facts about the current financial news and the credit crunch.
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