How Credit Repair Works
The Law Is On Your Side
When creditors report financial information to the three credit bureaus — Experian, Equifax, and TransUnion — the law requires that it be both accurate and verifiable. If the information does not meet these requirements the credit bureau must update or remove the information.
The Fair Credit Reporting Act (FCRA) is a piece of federal legislation that outlines all of your rights when it comes to credit reporting laws. It’s important to know both your own rights and those of third parties in the credit industry so that you don’t suffer the consequences of having a low credit score, especially when it’s avoidable.
Although the three credit bureaus are subject to federal law, they are not actually government entities. Experian, Equifax, and TransUnion are each for-profit businesses that are traded on the stock market. That makes it especially important for the government to create and enforce consumer-friendly laws, the FCRA being the most applicable to consumers. If these laws weren’t enacted and enforced, there would be no incentive (or repercussion) for credit bureaus or creditors to make sure they are performing their due diligence in accurately reporting your information.
One of the most helpful parts of the FCRA is that it gives you affordable access to your credit report. You even get one free copy from each credit bureau every 12 months. If you want to know where to start with credit repair, getting a copy of your credit report is the first step. Once you have it, you should review it carefully to ensure all of the information is accurate. If it’s not, it’s time to get those errors fixed, and ideally, raise your credit score.
You Have Rights
Credit bureaus are required to respond to all disputes, but it’s up to you to initiate one. You may file a dispute whenever you think that something on your credit report is either inaccurate or incomplete. The FCRA requires the credit bureau to investigate each dispute once it is filed. They must respond within 30 days from the date you filed, so be sure to get the process started as soon as you notice that something on your credit report looks wrong. You can begin the dispute process either online or through regular mail. We generally recommend submitting a formal letter rather than a web submission because you have a paper trail to document the process.
In the event that the credit bureau’s investigation shows that the item is indeed incomplete, inaccurate, or simply unverifiable, they must fix the item by either correcting the entry or removing it entirely from your credit report. If the item was causing damage to your credit score, you’ll usually notice an increase in your credit score. Just how much depends on what kind of information was removed or corrected.
An inquiry, for example, might just drop your credit score by five points or less. Something like a foreclosure could lower your score as much as 100 points. Still, a study by the FTC showed that as much as 25% of Americans have an error on their credit report that could negatively impact their credit score. If you fall into that large group, it’s vital to get your report cleaned up through an effective credit repair strategy.
How Can Credit Repair Services Help Me?
Credit repair services employ highly trained staff to work directly with collection agencies, creditors, and credit bureaus on your behalf. They are well versed in consumer laws so that they can help you exercise all of your legal rights. With years of experience, they are often able to help clients successfully remove negative items from their credit reports.
Although you can certainly file a dispute on your own, working with a credit repair company comes with a number of advantages. Just as creditors, collection agencies, and the credit bureaus must follow certain processes, consumers must do the same. In fact, your credit score could even get worse if you file a dispute incorrectly, so it’s important to get it right the very first time.
Not only are credit repair companies able to execute the dispute process in a professional manner, they also use other strategies to help their clients. Many people are excited to find out that not only have they had derogatory items removed, but their credit scores have also increased significantly after working with a professional company.
That’s because credit repair companies understand the nuances and intricacies of the law. Plus, they deal with creditors all the time and don’t let their emotions interfere with the process. These factors make them much better equipped to handle your disputes quickly, efficiently, and successfully than if you were to take on the entire process by yourself.
Credit Repair Takes Time and Effort
Another limiting factor for individuals attempting to resolve their own disputes is the amount of time and effort it can take. Rather than spending your time in a half-hearted attempt to prove your case, it’s often worth your while to hire someone else to do it for you. Don’t take time away from work or family to deal with a dispute, especially if you have more than one questionable item on your report. You have one chance to improve your credit this way — get the best odds by contacting a reputable credit repair company.
Why is Credit Repair Important?
If you think having bad credit isn’t a big deal, then think again. Anytime you go to apply for some sort of credit — like a loan, mortgage, or credit card — the creditor reviews your financial history through the form of your credit report. The best case scenario when you have bad credit is that you get approved for the loan or card, but pay exorbitant interest rates on your balance. The worst case scenario is that your application doesn’t get approved at all. And while it might not seem like a big deal now, it might feel a lot worse when you need cash for a financial emergency.
Having bad credit also affects you in more personal ways, not just financially. Did you know that employers can access your credit report? If you’re up for a promotion or applying for a new job that handles money in some form or fashion, then it’s very likely that you’ll have to authorize a credit check to get the job. And if they find out that you have a host of negative items on your credit report, you might damage your chances of landing the new gig.
New landlords also look at your credit report when you apply to rent a new house or apartment. They want to check how consistent you are in paying your bills and whether or not you’ve ever been evicted from a previous lease. The more negative information they find, the less likely you’ll be chosen for the apartment. And while there are ways to rent an apartment with bad credit, you can make it easier on yourself by working to fix your credit well in advance of needing a new living situation.
Clearly, having bad credit can affect your quality of life in so many ways. By repairing your credit, you’ll receive all the benefits of good credit, like quick credit approvals, low interest rates, and higher loan amounts. You also don’t have to worry about employers or landlords getting the wrong idea about your character based on the information in your credit report.
How to Get Started Today
So, are you ready to start improving your credit report? Select one of the top-ranked credit repair companies we’ve reviewed on our website and give them a call. We only list the best of the best, so you can rest assured they will achieve the most successful results possible. Once you contact them, they’ll tell you about specific strategies they use in the credit repair process, and can even advise you on your own personal situation.
And the best part? It’s completely free with no obligation. They’ll look at exactly what’s on your credit report and discuss the best strategy for you moving forward. If you only have one or two minor negative items, they might even recommend that you do it on your own. But if you have a credit report riddled with negative items, then chances are you’ll have the best outcome by hiring legal professionals to work on your behalf.
Remember that it takes time to repair your credit report. There’s a large amount of back and forth that goes on between creditors and the credit bureaus and it can stretch out over weeks or even months. But by starting the process now, you’ll begin to benefit from results in as little as 30 days. Don’t let bad credit hold you back from achieving your goals in life. Take control of the problem by working with a professional credit repair company and giving them a call today. You’ll thank yourself in a just a few weeks’ time.