The most important thing is to start the credit restoration process early.  Ideally, you should start before you even begin to look at rent to own homes listings.  Credit repair is a process and one that often isn’t quick.  The first thing you will need to do is carefully review your credit reports.  Once you have done this you should write down a plan of attack.

One thing you will probably need to do is pay off some of your credit card debt.  This is especially true if you are carrying high balances.  Ideally, you will want to get your total balances below 25% of your credit line.  You should do this for each account, not just the totals.  Even better, try to use your rental period to pay your accounts off in full.  Just make sure that you save enough for a down payment should you need to make one when it is time to get a mortgage.

Next, you need to address your collection accounts.  The best way that you can deal with these is to call the creditors and say that you will pay them off in full…but only if they agree to delete all negative information from your credit file.

The first thing that needs to be done to get out of credit card debt is to choose one or two cards to keep. Select from the ones that have the lowest annual interest rates. These cards are to only be used in the case of an emergency. Every other card should be cut up and disposed of. They will not be used ever again.

The next task at hand is to gather all of your bills. Make sure that the minimum monthly payment is being made on each account. Then pick the bill with the highest annual interest rate. It’s important to make additional payments on this every month. Do that until it is fully paid off and then start the process over with the next highest interest rate account.

Make an attempt on any card that has an interest rate that is higher than 14%, to get it lowered. Credit card statements have numbers to call. Use these to ask for a reduced rate. Or, try to consolidate as much debt as possible. Transfer the debt, if allowed, on to the card with the lowest interest rate. Once a card has a zero balance, be sure to cut that up too.

One of the final and most important things to do is to resolve to spend less. Don’t spend more than what is earned. This will, more than likely, be a constant struggle throughout life. It’s one that can be overcome though. Use cash for purchases and never spend more than can be afforded.

Getting out of credit card debt will lift a crushing weight off your shoulders.

The wildcats were not doing well on Saturday. About a third of the way through the 4th and final quarter, they were down 20-7. UK has the ball and turns it over. The fans in the stadium, start pouring towards the exits. Yours truly, watching it on TV at a local sports bar threw up my hands in defeat and went home. Many of us gave up. Little did we know, the Wildcats made a HUGE comeback and won the game. It would have been so exciting, but many of us gave up and missed out on the joy of victory.

In a similar way It is easy to give up when it comes to personal finance. There are times when it seems hopeless. You have a mountain of debt. You can’t seem to scrounge enough to buy a pack of Ramen Noodles, much less pay down that credit card bill. It can be depressing and overwhelming. Don’t give up! you can make it through. You will make it through. Just keep making the right choices.

Much like my Wildcats, you can make a comeback and so can I. No matter how far down or how late in the game. Stick with it, and you will have the victory!

-Kevin