Free Credit Score: Why I got It & What I Did With It

I have children and responsibilities. Being single is not easy. Not only does it mean working extra hard to pay the bills and save for your child’s education and future, but it means you have to be take care of your children soon.

I was never married; however after finding out about our pregnancy, we decided to move in together. But soon it all became too much for both of us so my partner bailed and left us with unpaid bills and a very poor financial situation.

I had no idea how to get a free credit score. My ex had poor spending habits; even though he did contribute, but he never really saved or agreed to open a joint account. Surprisingly my ex didn’t have a credit card, so my ex used mine to spend my hard earned money. During our time together we had to get a second car, which we bought on my credit card. When my ex left suddenly, I lost the amount of money he was contributing so paying for the second car became extremely difficult for me. Things started to go south real quick. I was worried because I had spent whatever I had managed to save within the first few weeks of my ex’s exit. At that time I was working as a marketing rep at a software house.

As I mentioned earlier, I soon started to miss my monthly car payments, which eventually went down as a bad debt on my credit card. Moreover I started to fall behind on my apartment rent and bills. My entire situation became too much for me to handle so I finally decided to ask a colleague for help. He worked in our finance department for help.

My colleague Tim explained the entire concept of credit score to me. He said I needed to find out my current credit score for which I had to get my credit report from my credit card issuer. When I got the report it was not what I needed to know. As Tim feared my credit score was bad.

I did not exactly know how bad credit score could influence my financial situation. Tim told me it could have serious repercussions. He said a bad credit score would make it impossible for me to secure loans for anything including housing, car leasing or student loans for my son etc. This had me extremely worried. I was my son’s only parent and only hope for a secured future. I had to do something.

I asked Tim how I could fix my situation. He told me even though things were not that great but there are ways to fix them. This gave me some hope.

Tim told me it was very useful to get credit reports regularly because not only it helps you keep your payments in check but also allows you to check for errors that could harm your credit score.

Tim also said I should get a secured credit card. I didn’t understand the concept at all so he explained it to me. He said a secured credit card for bad credit was secured or protected by a refundable deposit. If you deposited $500 as your collateral this would mean that if you were unable to make a payment the credit card issuer can take your deposit. Therefore your deposit could protect you from a missed payment and keep your credit score on the right track. The deposit limit can vary.

I was advised to set up a multiple payment plan. This way I could make more than one payment throughout the month. The reason for multiple payments is that your credit card issuer submits your credit report to the credit bureau each month. This report could be made on any day of the month. So if you paid your balance even a day after the report was made it won’t show on your report. With multiple payments your report would show lower outstanding balance throughout the month.

Tim also said that I should never reach my balance limit. In fact he said it was best I didn’t even get close. So the smart to do is to not use your credit card for every little purchase. It is best to use your credit card only for purchases that you are sure you can pay off easily. This way not only do you keep away from your balance limit, but also your balance remains low which makes it easier for you to pay it in full every month. Keeping your balance low and paying in full is great for your credit score.

Another great tip Tim gave me was to look into credit building loan. He said it is best to apply for a credit building loan. This type of loan is specially designed to help people like me who are struggling with their credit score.

I was also told to stay away from pay-day loans. Tim said these loans were offered by loan sharks who look for people who are desperate and need money immediately. These loans are usually taken in the time of emergency, which means when you take this loan you are usually in a bad financial situation. At a time when finances are not in good shape you usually are unable to pay the loan back, which gives you bad credit score.

Tim also said I should get credit for the rent I was paying for my apartment. However he did tell me that I should only do this if I was 100% sure I could pay my rent on time every month. Paying rent on time would help me build a good credit history that is useful for building good credit score.

In addition to these tips Tim said simple things like paying all my bills on time help build credit score. So I became very careful about my monthly bill payments and started to keep a chunk of cash aside just for bills so that I would always have some cash even if I had a bad month.

I must say I owe Tim a lot. He helped me get on the right track because I was a total financial mess. Now things are much better; not only have I started to save up, my son and I can spend a little extra money on recreation as well. I just wish I knew all this before so I wouldn’t have landed in so much trouble. Now I tell all my friends to always know their financial situation and never leave everything entirely to their partner.