It is a condition in which a borrower’s credit history is affected by CCJs(County Court Judgments) CCJs occurs when the borrower is not able to pay its debt. IVAs,( Individual Voluntary Arrangements) IVAs is a formal agreement between the debtor and the creditors. An IVAs’ proposal sets out how the debtor is going to repay the creditors, usually over a period of five years. Some other conditions are like defaults, late payment, bankruptcy (Bankruptcy is a legally declared inability or impairment of ability of an individual or organisation to pay their creditors) etc.
Here are some tips to Repair Bad Credit:
Try to pay all of your bills on time. Don’t go for a late payment because late
payments that are 30 days late or more gives a negative effect on your credit
rating. Reduce the number of credit cards you carry. Write to your creditors to request that they close your accounts and report this status change to all three credit-reporting agencies. Request in writing that your creditors reduce the credit limits on your accounts to lower. Get a secured credit card to help reestablish your credit. You will have to keep a designated amount of money in an account that will be sufficient to cover your charges. Make payments on time .Avoid bankruptcies because a bankruptcy stays on your credit report for up to 10 years. Also avoid tax liens which are for not paying state or federal income taxes or property taxes, and collections because collection accounts and paid tax liens stay on for seven years, and unpaid tax liens will haunt you forever. Get a yearly copy of your credit report to catch any errors.