How to repair your credit yourself
Most people accept that their credit report is very important. That means their credit score is also very important. It’s more important than “will I be able to buy this car or this house”. Your credit report is how the business world sees you, how you come across on paper, as a good opportunity for companies with a financial interest or as a doubtful risk. It affects every part of your life. Your credit report is influential in determining where you live, the extent of medical treatment you receive, where your children go to school and, sometimes, where you work. (Some employers require your credit report as part of the hiring process. The information it contains can be a factor as to whether you are offered employment—or not. You need to know how to repair your credit,and the sooner the better.
If you have bad credit or there is incorrect information in your credit report, you need to repair it.
How to repair your credit in two steps.
Step one: Correct your credit report. It doesn’t happen often, but sometimes incorrect information mysteriously appears on your credit report. Those errors need to be corrected. Having erroneous information removed from your credit is fairly easy. (I’ll cover this below.)
Step two: Get your credit life in order. Pay your bills on time, pay down your debt, and a few other things. (More on this in my next post “How to Improve Your Credit“.)
Important note:
Regardless the origin of any negative information you may have on your credit report, you need to know how to repair your credit. If you filed bankruptcy this year it’s possible to have a good credit score before it comes off your credit report. (Bankruptcies remain on your credit report 7 to 10 years depending on the type of bankruptcy you filed.)
Whatever you do, don’t hire out the work
Your credit report and score are very important
Don’t hire someone to fix your credit report for you. You can do it yourself. Credit repair professionals charge a lot of money, but they can’t speed up the process, and they can’t persuade the credit reporting company to change their minds. Credit reporting companies use facts only. “Prove it to me” should be their motto.
Knowing how to repair your credit report can and will save you a lot of money.
Before we start
There’s a right way and a wrong way to repair your credit. I’m telling you this because it’s important to know how to repair your credit before you start. Let’s get started.
There are certain items on your credit report that are time sensitive. You have to wait for the designated amount of time to go by before those items are removed. Among them are bankruptcies, foreclosures, delinquent student debt, and delinquent medical bills. Even with these on your credit report, you can improve your credit score. If you have one or more lingering items from your past you need to go ahead and start the process to repair your credit now. It does take some time, but the sooner you start, the sooner you’ll have a better credit score. That could be essential in the future: An improved credit score might help you get a better paying job.
Some things can be changed
You can’t change history, but if history is inaccurately reported in your credit report, you can get it fixed. I’ll cover this later.
Get a current credit report
Everyone is entitled to a free credit report every year. You can receive your free credit report at AnnualCreditReport.Com or by calling 1-877-322-8228. When you get it, examine it for inaccuracies and start the repair process.
How to repair your credit
Here we go
You’ll find the following information in your credit report. It’s important to check it and make sure there are no discrepancies. If you find inaccurate information, dispute it. (I’ll get back to this.) The smallest detail can make a difference in your future.
Your Name and Deviations:
Your name will appear first. It should be the one you use on credit applications. This includes married women who use their husband’s last name. This doesn’t affect your credit score, but needs to be correct. (By the way, it’s a good idea to be consistent when you fill out forms. Don’t use “Robert” or “Susan” sometimes and “Bob” or “Susie” others. Also, when using your first name, it’s best to use the spelling on your birth certificate.
Your Current and Previous Addresses:
Any place you have ever received mail should appear on your credit report.
Your Employer:
The name of your employer may appear on your credit report. It will be on it if you have provided it to any business that reports to the credit bureaus.
Revolving Accounts:
Revolving accounts are accounts you use over and over again without going through a reapplication process. Credit cards are the most common revolving accounts; multiple mortgages from the same company are not. (See the next item.)
Installment Loans
Installment loans are one time use loans. If you need to reuse them, you need to reapply for them each time. Loans like car loans, mortgages, and student loans are in this category.
Open and Closed Accounts
All open accounts should appear on your credit report. Closed accounts will appear for a period of 7 to 10 years depending on the credit reporting company.
Account Payment History
In this section there will a record of your payment history covering the last 2 years. This includes the payments you made during that period and if they were delinquent. Along with that will be note of events that took place in the last 24 months such as bankruptcies, foreclosures, and repossessions. Remember, bankruptcies, foreclosures, and repositions will also show up in the public records.
Recent Credit and Loan Applications
Any applications for credit will remain on your credit report for two years. Take the time to make sure there are no errors, that you, and no one else, made those applications. If you find questionable entries here, it could be a sign of attempted identity theft and should be monitored.
Collection Accounts
Any unpaid bills that have been sent to a collection agency will be listed in this section.
Public Records
If you have been taken to court for unpaid bills, the record will appear in the public records section. Any proceedings that have gone to court—repossessions, foreclosures, and bankruptcies—will be included. This information is time sensitive and each item will remain in your credit report for a set time, usually a period of 7 to 10 years.
Report and Dispute inaccurate information
Report all discrepancies to the credit reporting company: Submit by mail using certified mail and return receipt requested. (Note: You can submit online but you won’t have a paper copy for your records, and you no proof anyone received it.) equifax experian transunion. The mailing addresses are below:
Equifax
P.O. Box 740256
Atlanta, GA 30374-0256
Experian
P.O. Box 9701
Allen, TX 75013
TransUnion
P.O. Box 2000
Chester, PA 19016
Make an effective argument
You can find copies of dispute letters on the Federal trade commission consumer information website.
When you file your dispute send supporting documentation. To say that you are disputing something because it’s wrong won’t get you anywhere. Send copies of receipts, bank statements, documentation, etc. from the businesses involved. This means you’ll have to search your records and, possibly, obtain some information from those businesses.
Credit reporting agencies must investigate all claims—usually within 30 days—unless the claim is frivolous: If you have previously had an issue investigated with your complaint found to be insubstantial, and you resubmit without new supporting documentation, it will be considered frivolous. Credit reporting agencies are not required to investigate frivolous claims.
With regard to legitimate disputes, the credit reporting agency must share your information with the information provider. It’s the information provider that must determine if the dispute is true or false.
If the documentation you provide is accepted, the information provider (the business, bank, mortgage company, or other creditor) must notify all three major credit reporting agencies of the incorrect information…all three of them, not just the one you filed the dispute with.
When the investigation is complete
The credit reporting agency must give you the results of the investigation in writing. Inaccuracies pertaining to the issue must be corrected or removed as appropriate, and you must receive a new credit report.
If you request it, the credit reporting company must send notices of corrections to anyone who received your credit report in the last 6 months and any perspective employer from the past 2 years. (There will be a small charge for this.)
If the credit reporting company isn’t able to resolve your dispute you can request to have the dispute noted your future credit reports.
It’s important to note that the credit reporting agency can’t change the information in your credit report unless the information provider verifies the disputed information is incorrect.
If you don’t get satisfaction
If the credit reporting agency cannot secure positive resolution for you, you must be provided contact information for the information provider. At that point, you or your agent (lawyer) can attempt to get resolution.
Contact the information provider (the bank or other entity that issued you credit) in writing with your dispute. You must provide proof to the information provider as to your dispute. Provide copies of paid bills, cancelled checks, and anything else that supports your position.
If the information provider continues to report the disputed information, they must contact the credit reporting agency.
If the disputed issue is resolved in your favor, the information provider must report to the credit reporting agency what is to be changed or deleted. The credit reporting agency must change your credit report and report the change to the other two major credit reporting agencies.
Conclusion
Knowing how to repair your credit is essential in today’s world. Step one in repairing your credit is to obtain a current credit report. Since it’s possible that there will be some legitimate negative issues, it’s essential that all inaccurate information be removed. After you have done this, you can start the next phase of repairing your credit.