Protect Your Credit When Money is Tight
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When money is tight, there are a few things you can do to protect your credit, according to TransUnion.
The first thing you need to know is where you stand with your credit rating. You should contact the credit reporting agencies (TransUnion, Equifax, and Experian) to establish weekly access to your reports so that you can go over them checking them for any unusual activity and accurate information as it comes to your debts and payments.
Besides reviewing your credit reports, you also need to make sure that you continue making payments to your credit lenders.
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Your payment history is an important consideration when determining your credit score, so making on-time payments is critical in protecting your credit health.
If you think you may struggle to make a payment, reach out to the company where you have the account as soon as you can before the payment is due. Many times if you are having a temporary financial crisis, many companies will work with you and make adjustments that will protect your good credit rating.
If you do need to go into a forbearance or deferment program make sure with your creditors, ask questions so that you have a clear understanding of all the terms and conditions. You will also want to develop a plan for when the program ends to make sure you will be able to assume the regular payments again as scheduled.
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You also need to protect your credit against fraud. One way to do this is if you are not planning on applying for new credit anytime soon, you may want to consider freezing your credit.
Credit freezes are free, they don’t affect your credit score, and can be easily lifted whenever you need to do so.
You will need to place a credit freeze with all three credit reporting agencies separately if you want the most protection.
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You may also want to add a fraud alert to your credit report.
This service will alert your potential lender to take extra steps to verify your identity before granting you the credit.
If you choose to add this to one of the credit reporting agencies, the other two will automatically be notified as to add it to your report with them as well
By doing these three easy steps, you can protect your credit when money is tight as well as when you are able to grow in your financial success.
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