credit repair

How To Improve Your Credit Score

Know Where You’re Score’s at through Reports

Knowing what’s up with your scores is your first step in repairing it. Tap into TransUnion, Equifax, and Experian-the three credit bureaus utilize AnnualReport.com to provide you with your credit report for free once a year.

Get Your Facts Straightened

Any erroneous information on your credit report should help you out a lot. As a result, you can remove it and our credit score will immediately take a turn for the positive. But you should make sure that you get everything sorted out to really prove that the information is false. Always keep your receipts, canceled statements or checks showing payment to help you build your case. This will really prove that the purchase recorded on your credit report is wrong and will be fixed immediately, improving your credit score in the process.

Argue Errors that Occur in Your Report

Errors can definitely give you a wrong score on your credit report, which may make things worse than they normally appear. Should you wish to dispute this error, make sure you understand how credit reporting entities have their specific procedures for entry disputing. What you should keep in mind, though, is to ask for proof regarding the error. This will help you realize what the error you feel really is. This can come out in two ways: if there is proof, the entry will stay; if not, the entry is automatically removed, enhancing your credit score.

But what if they have proof but you believe it still is an error? Providing evidence that is stronger than what they provide will increase the chances of that entry removed.
You should take note, however, that if the credit bureau does not take your dispute seriously, this can be frustrating. But, be careful if the dispute is something that is obvious or insignificant.

As a result, you should be patient regarding the time it takes for any result. A minimum wait would be 30 days, but sometimes it can take about 45 to 60 days. Take note that if communication occurs between the credit bureau and you, or even between a creditor and the bureau, results could be in in a matter of weeks.
No matter how long it takes, be confident about your dispute. This will ensure that your rights are respected and your credit score redeemed, which is a huge plus for you in the future.

Enhance Your Debt-to-Credit Ratio

Improving your debt-to-credit ratio is vital in enhancing your credit score. If you happen to own three cards, then use them to help out your score. This can be done by maintaining low balances on each card by dividing your debt by the limit of the card.

If you happen to get a value of less than 10% or less, your debt-to-credit ratio is good. This helps your FICO Score or credit score at a positive toward maintaining a good ratio.

There are many factors that affect your credit score. In fact, 35% is from payment history, 30% from amount of debt, 10% from types of accounts, 15% from how long you’ve had credit, and 10% from history of looking for credit. Make sure you’re knowledgeable about these factors so you can modify how to improve your credit score altogether.

Four Steps to Avoid Credit Repair Scams

Falling for credit repair scams can be emotionally devastating and wind up costing you a lot of money. Your credit score determines how much you pay for things like insurance and mortgages and affects your ability to get approved for a loan. If you have found yourself in a situation where your credit score is less than desirable, there are many companies out there that can help you to rebuild your credit score. While there are many legitimate companies that can help you to rebuild your credit score, there are also many companies out there that are scams and prey on those who are vulnerable. These are the four steps to take to avoid credit repair scams.

Step 1:

Look for Companies That Don’t Make Outrageous Claims

If a company is claiming to easily erase anything negative on your credit report and that they can restore your credit without a problem then proceed with caution. Negative information cannot simply be erased unless it is not valid or accurate. If it is accurate, then it has to stay on your credit report for a predetermined amount of time. A company that tells you they can simply erase anything negative from your credit report should not be trusted and you should stay away from them to avoid falling for a credit repair scam.

Step 2:

Look for a Company that Educates their Clients

Legitimate credit repair companies should aim to educate their clients in the process of credit repairing and be able to inform you as to why your credit was damaged in the first place. It is possible to repair your credit on your own, the credit repair companies are just in place to help guide you through the process and make it easier to succeed. If a company tells you not to contact the major credit reporting companies directly or tells you that you will be unable to repair your credit on your own, then you should avoid them as they are most likely a scam.

Step 3:

Look for Credit Repair Companies that do not make you pay up-front

Legitimate credit repair companies will wait until after their services have been performed before they accept any payment. Companies that request payment up-front before they have performed the services that you are requesting are most likely a scam.

Step 4:

Look for credit repair companies that encourage you to work on improving your credit score rather than attempting to change your credit Identity

Some illegitimate credit repair companies try to convince their clients to create a new credit identity by applying for an employer Identification number to use for their credit report instead of their Social Security Number. Doing this can be considered fraud and any company that encourages the use of this is most likely a scam and should be avoided at all costs.

If you find yourself needing to repair your credit score and do not want to fall for a credit report scam then it is best to be familiar with your rights and know exactly what your credit score is and what the factors are that are lowering your credit score. It is also important to seek out the advice of a professional who is well versed and knowledgeable in FTC guidelines to help you navigate the credit repair process. There are many organizations that will offer credit repair counseling for free or little charge and there are also many organizations that will offer in-person credit counseling to those who need it.

Avoid False Promises of Credit Repair Companies

It is probably not true if it sounds untrue initially. Credit repair always proves the rule of thumb to be true. On most occasions the promises made by credit repair companies towards reducing your debt burden turn entirely false. Prior to repairing your credit, you might need to do one or more of the following things:

Obtain a new identity

A few of the companies might try to persuade you to create a different identity; they would try to establish that by creating a new identity you’ll be able to remove all of your bad credit history. You must know that it is not possible for you to create a duplicate identity; you’ll move against the law if you try to obtain a new social security number in your name.

Submitting wrong information

Stay away from options like submitting wrongful information regarding your purchases; a good company should only ask you to improve your bad history. Some companies would ask you to do it so that your information can be disputed and a few bad histories can be rectified to reflect a better look of your credit report. Remember, in doing so you’ll actually be committing fraud although it might sound good.

Paying for your credit report

Under a few conditions, you might be able to obtain a credit report without bearing any charges towards your credit repair company. Once your credit card application gets denied, it will take you some 60 days to obtain your credit report for free. While checking your report if your eyes meet with a mistake, then you may get it disputed with the information provider and the credit reporting agency.

No bad history on your credit report can actually be removed by any agency or individual. You may rectify any wrong information that you come across in your report without any charge; credit repair companies know the process better and can help speed up the process. At the same time, you’ll need to beware of companies that request you to pay a stipulated amount for working on your behalf and then vanish into the thin air without resolving your issue.

How Bad Credit Can Affect You

Credit scores are used to determine if you qualify for a loan, how much interest you will pay, what your loan terms will be, and whether or not you can get insurance. While those who have bad credit are still able to qualify for loans, they will most likely pay a significantly higher interest rate than those who have a good credit score. Having a bad credit score will also affect what type of loans you are eligible for. For instance, if you have a very low FICA score, then you will most likely not qualify for a standard vehicle loan and will instead have to take out a special loan that can have extremely high interest rates, additional fees, and other stipulations. This can wind up costing you thousands of dollars extra than if you were to take out a loan for the same car and have good credit. This is just one example of how having bad credit can affect you. Here is a list of the pitfalls that can come with having bad credit.

Bad Credit Could Mean Higher Financing Rates

Most big ticket purchases such as cars, houses, or even televisions are often paid for with a loan. The rate of these loans is determined by your credit score. If you have a good credit score, then a company will have more faith that you will pay back your loan and reward you with a lower interest rates and better loan terms (such as a longer loan or a clause that allows you to pay if off early without any penalty). If you have bad credit then these loan lenders believe that lending to you is a risk and will make it more difficult for you to obtain a loan. They will most likely charge you a higher interest rate and might even tack on additional fees to obtain the loan. They could also make you put down collateral that can be taken away from you to secure the loan.

Bad Credit Could Mean Having Higher Down Payments

If you are looking to purchase a home or other big ticket item you might get penalized for having bad credit by having to put down a higher down payment. The lender doesn’t believe that you will pay back the loan if you have bad credit, so they can reduce their risk by having you put down a larger down payment. This could make it more difficult for you to get a loan if you do not have the additional cash.

There are many long term effects of having bad credit. A person with bad credit will end up having to pay significantly more for an item (both in the form of a higher down payment and with higher interest rates) than a person who has good credit. This can make it difficult to get future loans because all of your cash is tied up into the loan that you currently have and can diminish your overall quality of life. I would suggest one of the credit repair companies, read our Lexington Law Reviews.

Best Credit Repair Options

Having a good credit score can save you hundreds or even thousands of dollars over having a bad credit score. If you have made poor choices that have affected your credit score negatively there are options that you can do to help repair your credit score. You can choose to repair your credit on your own or you can use a credit repair company to help you repair your credit. Here are the steps to take with both of the best credit repair options.

Steps to take if you are Repairing Your Credit Yourself

Repairing your credit can often be very time consuming and it will often take a long time before you see any improvement to your credit score. The very first thing that you will want to do if you are repairing your credit yourself is to obtain your credit report from all three of the credit reporting agencies. The three credit reporting agencies are Experian, Equifax, and TransUnion. Legally, you are entitled to get at least one free credit report each year from each of the agencies so this shouldn’t cost you any money. You can also get a free credit report if you have recently been denied credit during a credit application. Doing this will help you know exactly what is on your credit report and what things are negatively affecting your credit score.

After you have gotten your credit reports, make a note of any of the items that have incorrect information. Anything from incorrect amounts owed, incorrect dates, or incorrect addresses can be considered incorrect information and will be used to help you dispute the debts later. You will also need to get any documentation that you might have which proves that the information reported is incorrect. Be sure to make copies of each piece of documentation that you have so that you can send those in along with a dispute letter for the credit reporting agencies which have the bad debt listed. Be as specific as possible in your dispute letter as to why you are disputing the debt and highlight any proof that you might have to make the dispute process quicker. If there are multiple cases where the bad debt is incorrect then you will need to send one letter for each debt that you are disputing.

In addition to this, write the company that claims you have the bad debt and ask them for verification of the debt. If they cannot submit proof of the debt, then they will be forced to remove the bad debt from your credit report. If the creditor does not respond to your letter within 30 days, then the credit bureaus will have to remove the negative item from your credit report.

Once bad debts have been removed from one credit bureau, check to be sure the bad debt is also removed from the other agencies.

Steps to Take to Repair Your Credit with the use of a Professional

When looking at the best credit repair companies, the first step you will need to take if you are using a credit repair company will still be to get your credit reports. Then you will still want to make a note of any disputes that you might have and gather up your documents that support your reason for disputing the bad debt. Then you will want to find a credit repair company that has a good reputation and is well established. After you have done this, the credit repair company will do the rest of the work for you.