Having a bad credit score doesn’t have to impact borrowing again to consolidate your debts. There are many lines of credit you could try if you have bad credit.
The credit score system can be confusing and distressing for some people. For those with bad credit, it is important to improve your rating. Sometimes that might entail consolidating debts.
We look at improving bad credit scores and whether you should borrow on bad credit below.
Improving your bad credit score
If you have a bad credit score, you will most likely want to improve it before you apply for more lines of credit.
The easiest way to improve your bad credit score is to pay off your debts as quickly as possible. However, there are other things you can do too.
Registering on your local electoral roll, closing unused bank accounts and updating all your personal details with financial institutions can also help.
Lines of credit available
While there are fewer lines of credit available to people with bad credit scores, there are still options.
Bad credit score credit cards are one option that could help you prove yourself as reliable, with small credit limits giving you a chance to show you can make regular repayments.
However, it’s important to consider your financial situation and always make sure you can afford repayments before you commit to a new line of credit. After all, a missed payment will damage your credit score again.
If you’re unsure if a new line of credit is right for you or not, you could try talking to a financial advisor about your situation before making any financial commitments.
Alternatives to borrowing with bad credit
Under most circumstances, it is not advisable to pay off debt by incurring more debt. Taking out new lines of bad credit loans or credit cards could negatively harm you down the line.
Try to budget more effectively and pay down your existing debts. This may take time, but it will help you to build your credit score organically.
Becoming debt-free is not easy and it will take a lot of sacrifice, but once your bad credit is cleared, you will be in a better position to make financial decisions.
There are many budgeting apps and banking help you can receive to better manage your finances and clear debt, although some may be more helpful than others.
While you can still borrow with bad credit, it is important to ask yourself if you should.