Why is Credit Repair so Important

Your credit score is what banks and other establishments use to check whether they should approve your purchase, loan or job application. Naturally, this could mean the difference between an approval or a denial and why your credit repair is important should you be denied.  

Credit repair is necessary when your credit score is 600 or below. To give you an idea how this is calculated, everyone starts out with a good score but the moment you are late on a payment or a mortgage, this has an affect on your credit score. 

Does this always mean you will not be able to get a loan? In some cases no but you will probably get rates which are much higher compared to someone who has a good credit score. 

The only way to fix that is by paying off old debts and making sure that it does not happen again. 

If you think this can be done overnight, think again because the amount of money you owe might be too big and most people who have had this problem are only able to complete paying it after several months or even years. 

Should bankruptcy even be an option? Never because your record will be kept on file for 10 years and you can’t escape it. 

You can’t repair your credit similar to your car unless you know what is wrong. To do that, you need to get a copy of your credit report by obtaining this from one of the three credit agencies namely Equifax, Experian, and Trans Union.

When the credit report is in your hands, review what is on it. If you know for a fact that a certain issue has already been resolved, send a letter to that credit agency together with the supporting documents so your credit report can be corrected. 

For those who have outstanding balance, the case is different because you need to pay for it before you can get a settlement letter which should also be given to the credit agency for filing. 

Until that happens, you have to find some way to pay for it. You can get better terms by getting a debt consolidation package which is designed to buy you some time at lower interest rates.

Surprisingly, credit repair may be as simple as borrowing money since your credit score may not improve unless you apply for a loan. You don’t have to borrow a lot since a small amount like $500 is enough to get the ball rolling. Again, just make sure this is paid in the agreed upon time and in full.  

After reading this, you already have a clear picture as to why credit repair is needed. Could it have been avoided? The answer is yes but it is too late to think about that when the important thing to do is focus on the situation. 

Credit repair may be simple or complex and if you can’t do it alone don’t be afraid to ask help from a credit counselor. It won’t be long when you will once again be in good standing and you will once again be given a line of credit. 

So you don’t need credit repair again, monitor your expenses and do not spend beyond your means. 

When Do You Need Credit Repair

When do you need credit repair? The moment your credit score is anything less than 600 points because this could make it difficult for you to apply for a loan. 

If it just so happens that your credit score falls below the minimum, don’t panic because this issue can be resolved. Never for one moment should filing for bankruptcy become an option because this will be on your record for 10 years or so. 

Credit repair may not be as bad as you think if there happens to be a mistake on your credit report. You can check on that by getting a copy for free from one of the three credit agencies namely Equifax, Experian, and Trans Union. You may request a copy simultaneously or get one at different times of the year.

Once you have it, review if there are any errors on the document. There are instances that one report will say something different.

If you know for a fact that a certain issue has already been resolved, send a request to have this changed together with a letter and the documents that prove this should be removed from your record.

But what if the credit report is real? Well, the only thing you have to do to repair your credit score is to pay it off. If you are having a hard time due to the big amount, get help from a credit counselor who can act as a negotiator and help create a debt consolidation package. 

The debt consolidation package must be placed in writing as it signifies an agreement between you and the creditors. . This document will save your life should there be any problems in the future like if the creditors decide to void the agreement. 

Once the debt consolidation package has been made, it is time for you to come up with the money and that usually means cutting down your expenses for the moment. 

If what you are saving is not enough, you may need to make some hard choices like selling off certain valuables especially when no one will lend you the money except perhaps if you have friends that are very understanding. 

When you have finished paying off your debt that could take months or even years, make sure you get a settlement letter from them and send a copy of this to the credit bureaus so this can be updated on your credit report.

There are lessons to be learned once you have successfully undergone credit repair. 

First, keep an eye on your expenses. If the credit given to you is quite big, don’t be tempted to max it because you will mostly have a hard time paying for it. 

Second, while most creditors will allow you to pay a minimum, whatever is left grows because of interests so you are not doing yourself any favors by not paying this amount in full.

Third, if this is something you can’t do alone, don’t be ashamed to ask for help because there are counselors ready to help you out. 

Fourth, pay all your bills on time and in full. 

Credit repair could have been avoided if you played it smart. Now that you are here, you have to do what is needed so it can be corrected. 

Ways on How to Perform Credit Repair on Your Own

When the time comes that your credit becomes a bad one, you will notice that several credit firm will get in touch with you and offer their services to help you get through the problem, but for a fee. Perhaps, they have a point; however, don’t you think your first step when suffering from bad credit should be to fix it all by yourself? You may not know it yet, but performing a credit repair on your own may be the best thing you have ever done.

It may seem that repairing your own credit is such a difficult task; however, those who have tried this process on their own would tell you that it is not really as tough as it seems. Thus, if you want to be one of those people who repair their own credit, you may want to start it right. First, you should contact at least one of the major reporting agencies – TransUnion, Experian and Equifax. You may want to request for your credit report.

And when you already have a copy of your credit report at hand, try to check the accuracy of all the information indicated therein; more or less you will find some discrepancies. There are instances when your previous debts which you have already satisfied are still reflected and still included on the report.

Be ready to mark these errors on the report itself, or on a separate piece of paper. Then, submit a statement regarding these errors to the agency from which you have received the report. After the submission of a written report, you may want to contact them by phone as well. If they ask for a proof regarding the error, you should be able to present your credit report.

It is either they will check the mistake made and correct them if it was proven that there really was a mistake, or they will inform you that they will need additional evidence to support your claim. Thus, if you really want to make better your credit, you would want to start by making your credit report as accurate as it should be.

As another big step in repairing your credit, whether you are doing it on your own or with the help of a debt counselor, is the process of establishing a budget plan to limit your finances. This will help you prevent incurring obligations which you will not be able to handle anymore. This help you keep you from doing the same mistakes that you have made before. So here, you will see that you really do not need the help of credit counselors, because you can tell yourself what to do and not to do when it comes to spending your credit.

Yes, credit repairing is a serious matter and it will require a great amount of effort and time from you. But as you go on with the credit repair, you will realize that it really has positive effects that would be favorable for you.

Would it not be nice to know that you have made it through your credit problems on your own effort? You achieved it on your own. Perhaps, the hardships of the process of credit repair will teach you not to mess up with your credit again. 

Tips on Credit Repair

Credit repair is the process of getting you back on the good side of your creditors. Without it, you will not be able to borrow any money which is why it is important to know how to do it. 

The first step is to know how the bad the situation is and the only way to do that will be to get a copy of your credit report. You can get this for free by getting in touch with one of the three credit agencies namely Equifax, Experian, and Trans Union.

If it just so happens that there is a discrepancy in your credit report to which you know has already been resolved, sending a letter and the supporting documents is all you need to fix it. 

But if the credit report is correct, credit repair can only be done by paying it off. It will be a good idea to talk to your creditors and ask if you can strike a deal which will allow you to pay the said amount in staggered terms. 

If they agree to this, make sure that this is written on paper so you have something to hold on to if ever they decide to change their minds. 

Should you have problems talking to your creditor, don’t give up and instead hire a credit repair company to act as the mediator. Talking to professionals has a lot of benefits and two of them happen to be lower payment and interest terms.

Credit repair takes time and since money is always the issue, be ready to make certain sacrifices and reduce your expenses. If what you are earning is not enough, you may have to sell off some valuables and assets. 

People who have outstanding loans must still be able to pay for other things like mortgage and other bills. The scenario itself is like fighting a campaign in many fronts but you have no choice because failure to miss other payments will only make matter worse. 

No one said that when you are undergoing credit repair, you cannot use your credit card. In fact, you can still use it just make sure you do not max it like before because your total debt compared to your total credit makes up 30% of your credit score. 

Once you are able to improve your credit score, keep up the good work. At the same time, apply for either a department store credit card or a secured credit card. 

Filing for bankruptcy is never an option with regards to credit repair. This is because it is like taking a nose dive when your record will be kept on file for 10 years and during this time, interest rates will continue to pile up and the amount of money that you owe only grows. 

The credit repair tips mentioned are easy for anyone to follow. Once you start paying off your debt, make sure you are able to do it so you can once again be in the green. 

Is credit repair easy? Not really because it really depends how much you owe the creditors. Some individuals owe a thousand or two while for others it is quite bigger and that is really a problem. 

So analyze your situation, take the appropriate steps in credit repair and make sure this does not happen again. 

Timing Credit Repair

Well basically, the right timing for credit repair is today. If you have found out that your credit scores are going low or is already low then why do you have to wait until you in a position where it is more difficult to repair your credit standing. Credit repair needs no best time actually, but what it does need is for you to start as early or as soon as possible.

You don’t always need to have a drastic change in lifestyle or sudden shift of your finances to repair your damaged credit reputation but sometimes all you need is to handle your credits and loans one step at a time. But you need to push yourself to begin. You need to start somewhere.

Fixing your credit scores cannot be done overnight, just like the way you accumulated large credits you need some time before your scores improve. There are ways to do it. One way would be to hire a credit repair service. They usually take six months at the least to fix or show some improvements in your credit scores. Some services will even take up to nine months before your scores show some improvement.

There are various reasons for this and the credit service company is not always to blame. The status of your credit scores might be the main reason. So don’t feel exasperated. Although, it would be great to check the identities of the credit service company before you sign a contract. You’ll never know if the company is legitimate or not if you don’t do some background checks. 

Aside from credit repair companies, there are credit counselors as well which can help you with your credit payments. If you feel you won’t be able to make regular credit payments, it would be great to seek some help. The good thing about these services is that most of the time they have payment plans for you so you can afford their help. 

One other way for you to help yourself is to not apply for new credit payments. Don’t add to all your problems. Rather than making yourself deeper in debt, what you should do is work on your problems and helps improve your credit scores. Financial discipline is one of the best ways to achieve credit independence. Creditors will always shy away from people who cannot meet the obligations of their debts.

It is very hard to obtain new loans if you keep defaulting on your current debt payments. But the idea, of course, is to totally be free from debts. However, once you have begun paying regularly your credits or loans, companies will find you responsible enough with your credits and eventually your credit scores will increase. 

Just remember that with regards to your credits, if is important that you know everything about it. Do your own research and read more about credit, loans, and repairing your credit scores. The more informed you are the better you can decide on matters regarding your financial stability. The same way goes with credit repair. Aside from timing credit repair now, you should put it on yourself to learn as much as you can about the how’s of repairing your credit.

Even if you’re not a lawyer or a financial expert, you can help yourself with regards to your credit standing. All  you need is a thorough understanding of credits. 

Starting Your Own Credit Repair Business

Even before the recession, there are a lot of people that need credit repair. It’s because these individuals spent way beyond their means and the only way they can have good standing again is to pay for it. There is an opportunity here to make some money especially when you decide to put up your own credit repair business. 

Credit repair companies continue to do well because during good times and bad, there are people who will always be in debt. To help you get started, you need to educate yourself first about the in and out of the business so you are able to help the client. 

Everything you need to know about the credit repair business can be learned from companies that offer such training. When looking for them, make sure that they are legitimate because there is the possibility of signing up in a program that is just a scam. 

Aside from credit repair companies that give classroom training, there are companies which you can also learn from online. They even have a software program that will teach you everything there is to know. Just check if it is worth spending your hard earned money. 

The nice thing about a credit repair business is that you can start this at home before shelling out money to rent office space. You can have clients drop by or you have to make the effort to meet them to discuss their financial situation. 

But how do you find clients? Starting out, you can ask friends and family for help because they may need your help or they know someone who does. When you talk to a client, make sure they know their rights as a consumer because this is required by law under the Credit Repair Organizations Act. 

You should also explain what you can do and what you can’t because promising them that their credit report will be clean once you act on it is impossible. All you can do is assist in improving their credit score.  

Since you are in the business of making money, you have to be patient when working with a client. You can’t expect them to pay you up front. In fact, you are not supposed to ask for money until you are able to help them solve their problem. 

A credit repair business or any kind for that matter will have problems especially when you are just starting out. Initially, some mistakes will be made but you should not look at them as setbacks but a lesson learned so you can offer better services in the future. 

Aside from making deals between the client and the creditor, it will also be nice if you can offer some advice so they can save money and get out of debt. At the end, this is what your business is all about and if you help them, they will surely recommend other clients. 

If it so happens that starting a credit repair business is difficult, another option to help you get in the game is to buy the business from someone else who is willing to relinquish it to you. Can this happen?

Yes because some entrepreneurs may want a change in their careers and want to hand this off to someone who is just as determined as them. 

Simple Steps in Doing Your Own Credit Repair

In today's slowed down economy, everyone needs to maintain a good credit status. A good credit rating means one is financially responsible enough to keep the connect between personal income and spending on a constant and realistic level. So if one suffers from missed payments, this reflects badly on one's credit status. Enter credit repair. 

This article covers some tips so you can do the credit repair yourself, so you won't have to pay for a company to do that for you. Most of those companies offering an almost instant credit repair are frauds anyway. 

Acquire hard and soft copies of your credit reports from the credit companies. It's always better to know the lay of the land than not to know. You should be able to receive a no cost credit report per year. So avail of that. Also, when you get denied for something, you also become eligible to ask for a no cost credit report. This will give you a clear view of where you stand, and tell you how much work needs to be done. When you have the accurate numbers, you can plan ahead better than when you relied on guesswork. 

Examine your own credit history, spending behavior. You have to absolutely certain all accounts are yours, that one pretended to be someone else and spent under your name. Identity theft is common and you can try to dispute the records when you think someone posed as you, over the phone or via email and snail mail. Also, once you ascertain all the accounts are truly yours, make sure they balance out. Pay up what's still needed to be paid. Tie up loose ends. 

Settle accounts in collection first, and right away. Address these first as they negatively affect your credit record. Most collection companies will take whatever you can give them, and since they're willing to talk this out, you might as well call them and see how far you can plan your debt payment to them, before actually starting payment. 

Bring your maxed out credit cards below its limit. It could take maybe two whole years for your credit status to get better when you have maxed out cards. Some companies out there actually do try to lend you a hand with this, at no cost at all. But you have to find those legitimate no charge companies yourself, else you be scammed into payment. 

Ask relative to add your name to the list of users they allow to use their credit card/s. If your name appears in someone else's credit card users' list, that's taken as a sign of your trustworthiness. That means you credit provided is assumed to have found out you're financially stable. 

No one said it would be easy to regain a good credit status, especially with the economy this down in the dumps. You can do your own credit repair cleanly, legitimately, but it would take some time, and some continuous, focused effort.

But the good thing is that you can do it yourself and it can be at no cost to you. 

Programs Lined up for Credit Repair

Suffering from a bad credit is not one of your pleasant memories. It can even be considered as a bad dream, and you have no other wish but to wake up from such nightmare. This is something most of you can understand because this is what credit can give you. Thus, if you wish to improve on your credit score, you may want to try a credit repair program.

There are a lot of credit repair programs to choose from, and this write up can provide you with examples of different programs that can help you with your credit problem, and as you read further, you will know how each of them can benefit you. 

A seminar which can discuss the mechanics of a credit repair program is a good way for you to get to know the program being focused on. Credit repair firms that may offer services like credit counseling are the ones who usually conduct seminars like this. However, there may be times when a seminar like this is also conducted by some universities and colleges, and even state or local organizations. Their objective is to get your attention so that you would consider hiring their services for your credit problems. 

 A whole day into the seminar will let you know the importance of knowledge regarding your credit score. Thus, you should be taught how to read your credit report, and you should know your possible actions if you are faced with serious credit problems. By the end of the seminar, you should have already equipped yourself with the tools necessary for the proper management of your credit. Lastly, you should be able to create your own financial plan to repair your credit so that you can continue on being free from debts.

Computer software programs can also be used as a program to help you improve on your credit score. Several computer programs are designed to assist you in repairing your credit, you just have to choose the software that is compatible with your own personal computer. These programs are very economical, and best of all they can be installed just within the comforts of your home.

Most of the computer programs have a guaranteed money-back if it was not able to help you with your needs. Some of them offer a free-trial period so that you can check out their efficiency. These features can assure you that the program will surely give an answer to your problems.

Some programs can also be seen in magazines, such as the Consumer’s Digest. These can give you simple solutions to your credit problems. They can give you an idea on what to change with your credit report by pointing out the errors and mistakes which may be committed on your own record. And as soon as you have established your credit repair goal, these programs can help you keep track of your finances and credit. 

These credit repair programs offer so much advantage for you. They offer just about the same services that you can get from credit counselors, but they appear to be cheaper and more convenient since they are just within your home. 

No Need For Credit Repair If...

Credit repair is the process of fixing your current credit standing to make things favorable for you in the future with credit companies and financial agencies. Regardless of what you file, a mortgage, a loan perhaps, or even a credit card, your finances will be checked by the credit card company, bank or agency.

They will determine if you have a good credit standing and checked the financial risks involved and then they will decide if they will grant you the credit that you applied for and site the specific conditions involved if they do decide on your favor. If they approved your loan or credit card application, then that means you have a good credit history. There is no need for a credit repair if you have a good credit standing and stable finances. 

However, in order to achieve such standing you better avoid the things that will lead you to a situation where you will be buried by your debts. Practice a simple lifestyle that will give you a sound financial status. The most basic of course is to make sure that you meet the bill payments on time. Your credit card bills would be the first that you need to control and maintain.

If you use your credit cards, settle the credits on time. This will show the credit company that you have no intention of defaulting on your loans and you are a responsible creditor. Credit card agencies will give you a positive credit rating and will give you a good deal on your loans or give you a credit card with a high credit limit. 

I can only stress the importance of paying bills on time. It is said that about 30% of your credit score is based on how you settle your debt payments. You will have a better chance of meeting the bill payment deadlines if you create a payment plan where you outline your goals. This will help you pay bills on time. 

Another thing that could help you avoid a bad credit score is by not maxing out on your credit card. Credit agencies determine your credit score also by the available credit you have remaining. Believe it or not having the unused credit increases your credit score. So even if you have credit cards that you’re not using do not close or forfeit those cards.

They can help increase your credit scores. The length of time you have a credit line open in an agency is also interpreted as having a good relationship with that company. This also brings in positive credit rating which is another good reason for you to keep cards unused or sparingly used as much as possible.

Also, do not apply for more credit cards if you already have outstanding card payments to begin with. Every card application will reflect on your ability and responsibility to manage or handle debts. Increasing your credit scores is a good way to reestablish your financial stability for your creditors and future financers as well. 

Measure the way you spend and if you find that you can’t control the use of credit cards, then you might think of more drastic ways to alter your lifestyle. A severe intervention might be solution such as contacting your credit card company and lowering your credit limit if they gave you a high one. 

Managing your finances to achieve financial stability and independence is necessary to maintain a good credit standing. There is no need for credit repair if you keep within your credit and financial goals. 

Look for Your Own Credit Repair Kit

The credit repair market has become popular nowadays; and because of its popularity, a lot of credit repair products have claimed that they are the best available. Credit repair products may include books, CDs and computer software that are designed to help those individuals who have poor credit scores. These kits help individuals face their credit problems and give good solutions to repair unwanted credit problems. 

An example of a book is “The Credit Repair Kit” written by John Ventura. This book is very popular nowadays and it has received good reviews by a lot of people. It includes references on the basic concepts of credit. It provides solutions for credit problems and all the other information necessary to help one person maintain a good credit standing. This book caters to individuals who are not experts and who are just concerned in repairing their credit. Thus, this book is an easy read for people who want to improve their credit standing.

The internet also has a collection of hundred and thousands of electronic books which can be very useful for credit repairs. These e-books can be downloaded straight into your personal computer, and you may just open it anytime you want. The contents of these e-books are just about the same as those in hardbound books; this is why some people consider the e-books are more convenient.

Aside from the books, computer softwares are also used for repairing credit. Applications can easily be used and viewed from your own computer. These applications can connect you straight to credit reporting agencies where you can confirm and authenticate information enclosed in your credit report. Likewise, these softwares can help you keep an eye on the status of your credit.

In buying your very own credit repair kit, you should take note of some things. These things might help you in deciding which kit would best work for you:

• The kit should be able to educate you on how to read a credit report and tell you how to know your own credit score

• It must be able to help you raise your credit score and get better credit rating

• It should be able to make you understand how agencies evaluate and collect information for your credit report

• It should give you ideas on how to ask for the assistance of a credit reporting agency should there be discrepancies on your credit report

• It should inform you how to handle identity theft 

• And lastly, after fully repairing your credit problems, it should be able to help you avoid credit problems in the future.

These are just some of the kits that are made available for everyone who wish to have an answer to their credit problem. These kits are very useful, because they serve as guidelines for people who may have difficulties in managing their credits. But, in buying kits like this, you should always be careful. You should take into account some things that might help you in coming up with the decision.

Since there are a lot of products that are being offered all over the market, you should be able to pick out which one of these is the best for you. 

Legality Of Credit Repair

Is credit repair a legal undertaking? Well, the answer to that question would be a resounding yes. There are, of course, some legal limitations like being actually truthful with financial reports and credit entries. So as long as you enter the right information in the forms you won’t be legally liable. So all in all, repairing your credit scores is legal and pretty much accepted by banks, credit companies, and other financial related companies. 

But the real question really is not the legal aspect of repairing your credit but rather on the safe and legitimate ways to improve your credit scores. You need to work hard and probably against your present lifestyle in order to change your finances. If you are in the habit of charging expenses to credit cards, then that’s the first thing that you will have to stop. For one, you don’t want to add more to your increasing debts. The right word here is having the right financial discipline. 

One good thing about credit companies is that they will understand if the credits that have been incurred are unavoidable or due to truly uncontrollable circumstances. However, understanding the situation is different from letting your off your credits. They will never concede payments for your loans but they can make some adjustments regarding your credit records and make certain that you will not receive that too low of a credit score provided that you pay what you have owed based on a plan that has been agreed by both parties. 

A good way to show you are sincere in your payments of credits or loans is paying promptly and continuously. Defaulting on your debts is never an option. Arrange a feasible and attainable payment plan where you can pay off your debts and attain financial stability. Don’t be afraid to hire some help though. There are some credit repair services as well as credit counselors that can help with your problems. However, do look into these kinds of companies first.

Legally, no one can remove or change any accurate credit records or information from reports. What they can do is get a request to take a second look at the credit report and formulate some sort of plans to fix your finances. 

The problem with this situation is that you can often do the same credit repair techniques these companies employ. You can call up credit bureaus and establish your own financial plans in order to fix your own credit score. So instead of spending money on these companies, you might be better off spending the money on credit payments instead.

What you will need is an understanding of how the credit system works and how you can properly fix your credit problems. This will take some time on your part and a lot of studying so if you would handle your credit problems yourself, prepare for a lot of sacrifices in terms of time and effort.

Evaluating your financial situation and finding the various options for fixing your credit problems is a good step to start. There’s also one reason why hiring a credit repair company is not always a good idea. You are the only one who knows the actual situation of your debts and making your own debt consolidation and negotiating with creditors on what is feasible in terms of payment and improving your credit scores.

You will eventually learn the various legal ways of credit repair and apply them in your case. You have to make extra effort and believe that you can fix your credit problems.

How to Write a Credit Repair Dispute Letter

Are you happy with your credit report? If your score is 700 or above, you might be but if it is 600 or below, you should worry because you will be paying more when you try to get a loan or purchase something. If you believe that your credit score should be higher, you should know how to write a credit repair dispute letter. 

Before you can write your credit repair dispute letter, you must first a copy of your credit report. You can get this for free from one of the three credit agencies namely Equifax, Experian or Trans Union.

When you get the copy, review it carefully and check if there are any errors. Take note of each one and then being composing your letter. 

Since the credit agencies gave you the report, the errors you want to dispute must be addressed to them. Since the report from the three credit agencies may be different, it will be a good idea to send each one a copy so everyone is on the same page with regards to your credit standing. 

Don’t make the mistake of putting all the errors in one letter. It is best to dispute each claim one at a time so the credit agency will not think that you are simply pulling their leg. You don’t have to wait for a reply before sending another one it’s just that each claim must be handled delicately so a proper investigation into the matter can be done. 

You should give the credit agency time to reply to the claims you have disputed. This is because the credit agency will conduct their own investigation before sending you a reply. To make their work a little easier, send supporting documents when you write the credit repair dispute letter. 

It may not be a big deal but when you write a letter to the credit agency, consider writing it rather than typing this and printing it on paper. 

To prove a point, it is best to use strong words like erroneous, outdated, misleading or unverifiable. Remember, you don’t have to explain in detail why you are complaining because the supporting documents and an investigation will make the truth come out. 

For people who have never written a dispute letter before, there are some samples which you can copy online. Just change the name, the date and a few other details because your concerns are different from what was laid down as a guide. 

When you finished writing the credit repair dispute letter, mail it using the postal service and just wait. Normally, it will take 2 week to a month before they receive it. If the investigation has shown that you are right, you will receive a new credit report 2 to 4 weeks later with a higher credit score. 

Since 1970, the Fair Credit Reporting Act of FCRA has been in place to give people the opportunity to dispute the claims that are printed on their credit report. If you feel that the report is false, don’t just accept it but take steps so this can be changed.

Now that you know how to write a credit repair dispute letter, get a copy of your credit report and then review it thoroughly. 

How to Spot a Credit Repair Scam

Credit repair is the only solution when your credit score is not very good. While some people do it on their own, there are those who ask for help. If you need assistance, you should know how to spot if this company is legitimate or not. 

The first thing you have to know about credit repair companies is that they are governed by a law known as the Credit Repair Organizations Act. This means you have certain rights that you should know about and any company who violates the rules is probably just a scam. 

You can tell if this is a credit repair scam if;

The credit repair company does not give you a pamphlet which states your rights under federal and state laws. 

If they have a copy, you must be able to read and review it before you are asked to sign anything. 

Upon reviewing the contract, it should be indicated there how much money you will be charged for their services, the services they will offer, the date by which this will be done as well as the name and address of the organization. There should also be a clause in the contract telling that you can cancel the contract within 3 days. 

The credit repair company tells you to pay up front for their services even if they have not done anything yet. The law states that they can only be paid after they have done their part in helping you repair your credit. 

If they promise that they can remove anything in your credit report. If this is not possible, they might even say that they will help you create a new federal employer identification number which of course is illegal. 

Lastly, the credit repair agency gives you a piece of paper which you have to sign stating that you waive your rights under the CROA or Credit Repair Organization Act. 

There are certain things that a credit repair company can do and improving your credit score from their end is not one of them. This is something that you have to do yourself because you are the one that owes your creditors the money. 

All they can do is facilitate a deal that is good for both parties like a debt consolidation plan which you have to fulfill. 

Should the information stated in your credit report be wrong, again there is nothing you can do because you are the only one that has the supporting documents which prove these issues have been resolved. You may not even need the help of a credit repair agency because you can send a letter together with the documents to the crediting agency. 

If it just so happens that the credit repair agency has asked for payment up front, not informed you for your rights as a consumer, want you to waive your rights or tell you to do anything illegal, walk away and report them to the authorities. After that, continue looking for a legitimate credit repair company. 

To tell if this company is a scam or not, you can also check with the Better Business Bureau and any other agencies in your area which are responsible for preventing such things to happen. No one wants to be come a victim but when you desperately need credit repair, it is possible. 

How to Repair Your Bad Credit Standing

In these economically hard times, your one chance for survival is to have some decent savings in the bank. That way, should you lose your job because of the recession that is going on, you will have something to fall back to, some money that will help tide you over until you get another job. If you don’t have this, your only alternative is to get a loan. But what if you have a bad credit standing? How can you repair bad credit?

A bad credit standing is achieved if you have managed to not take care of your finances and loans. People with bad credit scores are those that have not had any payments for their loans for years or those that have not managed to even pay half of their credit card debts. If you have a couple of bank loans and a few credit cards that you have not yet fully paid in years and with interest already growing, chances are you have a bad credit standing.

Although it is quite easy to get a bad credit standing, it is hard to repair your reputation with the banks and redeem yourself. However, it is not saying that it is some impossible task. You can repair your bad credit by following some of these tips and tricks.

1. Get a Credit counseling 

Admitting that you have a problem and seeking help is the first sign that you are willing to change your ways. For banks and financial companies, this is a good sign. It means that you are willing to make changes in your life and you are willing to face the consequences of your actions. Credit counseling will provide you with sound advice on how to manage you debt and how to make small payments until you finish paying for the debt. It will even give tips on how to save money and on how to quell your shopping addiction.

2. Making payments 

You also need to show that you are going to pay for your loans and you can do this by making regular payments to the account. It does not matter if you cannot pay the whole amount or that you are only paying a small portion of the total loan. What is important is you are paying the loan. 

3. Consolidate your debt 

Most people who have multiple debts will be asked to make one huge loan to pay for all the other debts so that you will only need to worry about just one loan. Before you do this, make sure that you have checked with all the banks and have managed to get the lowest interest rates for the loan. This way, you can save much especially if the interest of the new loan is significantly smaller than the interests of the loans that you are paying for. 

4. Make a commitment 

Going to the bank and assuring them that you will be paying your loan will give the impression that you are a man of your word and that you are not afraid to face them. When you do this, it will be more likely for the banks to give you a loan again especially if you need them in an emergency. After all, you were man enough to repair your badly-shaped credit rating. How can they not trust you?

Easy and Quick Steps for Credit Repair

In today’s society where we are in a generation which is very much influenced by credit transactions, bad credit may definitely cause misery to one’s life when it is not resolved. Imagine, without a good crest standing, you cannot easily get a good apartment, much more to mortgage. Thus, this article may help you to avoid the mistakes that may lead to a bad credit, and this may provide ways to an easier and faster credit repair.

The word “quick” is a very relative word, thus it may differ from one person’s definition to another. It may depend on the situation that each individual is into as of the moment. For some people, thirty days is quick, but for some, lesser days is their meaning of quick.

Your situation may include all the damages that were inflicted, and their effects. Your financial standing, your efforts to resolve these problems, as well as your moral fiber are all considerations that are to be taken account. 

You should always remember that in resolving these credit problems, there is always hope. Here are some of the ways on how you may restore your credit and remove all negative items that make it a bad credit:

1. First and foremost of all, you should always remember to pay your bills on time. Thirty five percent of your credit score is accounted on your ability to pay bills before they fall due. Tardiness may cause you to lose as much as 100 points. Thus, this first step is very much important for it can either make or break your attempt to repair your credit standing. Thus, you should always do everything in your power to settle all your bills on time.

2. Try to be aware of what is written on your credit report. If you are not yet insolvent, or something near that, you should refrain from getting free annual credit reports. Some experts believe that these free reports are tied to a technicality that increases time for reinvestigation when there is a dispute. Thus from thirty days, it shall become forty days.

3. You need to raise your credit score. With an increased credit score, the repair process can be accelerated. You may increase your credit score by cutting down your existing balances and debts.

4. Make sure that your credit reports do not have inaccurate information.  These mistakes may hold back your ability to get credit. Be vigilant of these details, some debt collectors may use this dirty tactic against you. Once you have seen inaccuracies, you should report them to the bureau in writing. If the mistake was committed by the furnisher, then you should inform him because it is his duty to correct such mistakes. However, if such errors were made by collectors, then a report against them should really be submitted.

5. You may also try to dispute entries made by credit bureaus because old debts are not worth verifying anymore. However, if you try this kind of defense, you should not rely on dispute letters found in the internet. It would be better if you write your own letter. This may show how legitimate your claim is.

6. Lastly, you should not dispute your open accounts for these may help you build a good credit history. Just make sure that you pay them on time. 

Do It Yourself Credit Repair

What do you do when you have a bad credit score? Panicking will not solve anything and if you can take this problem without any assistance, you can surely do the credit repair yourself. 

But how do you do that? The first step is to find out what is written on your credit report. Is everything there correct? Should there be discrepancies, send a letter to the credit agency together with the supporting documents. That way, they can make the changes and this will be reflected on your credit report. 

If there is nothing wrong with the report and you have a problem paying your creditors, it is best to inform them at once so they know what is going on and a deal can be struck. To them, they would much rather that you pay a certain amount rather than nothing each month. 

This is because even if they can take the matter to court and they do win, you will still not have enough money to pay for what you actually owe them and in the end, they do not get anything out of it. 

The agreement you struck must be made in writing so you have something to show in your defense should any problems arise in the future. Since they will keep their part of the bargain, just make sure you do your part. 

To do that, you need to create a budget and make sure you are saving enough money to what you agreed to pay. You may have to cut down your shopping expenses and eating out for quite some time. Whatever you earn should be used only for the essentials like bill, gas and groceries. 

Minimize the use of your credit card. As much as possible, pay for items with cash. If you need to use your credit card, monitor how much you can only spend monthly so the money you already owe does not get any bigger. 

If you have more than 4 credit cards, try cutting them down to only two. The ones which should go are the ones that have high interest rates and those that were less than 6 months old. 

At the same time that you are paying off your debt, it will be a good idea to get a secured credit card to continue building up your credit history. This type of card is unique because you already have the funds in the bank and this will just be deducted every time this is swiped in a card terminal. 

Since banks will not give you a loan when you need cash, join a credit union. 

You will soon have a good credit rating if you are able to stick to the plan for the next few months or years. Remember, your payment history has the heaviest impact on your credit score. 

Credit repair is being able to pay what you owe gradually is much better than filing for bankruptcy. This is because it will be on your credit for the next 10 years so why put yourself in that situation when you can do something to change it now. All it takes is some will power and guts to face it head on.

Remember, you put yourself in this situation so find a way to dig yourself out. 

Credit Repair and Counseling

Have you ever spent beyond your means? Don’t worry you are not the only one who has made this mistake because some people think that as long as their purchase is approved everything is ok. But is it? When the bills come in and you can’t pay for them, you might need credit repair and counseling. 

Credit counseling can help with credit repair because they will act as your financial advisor. Most of these individuals are certified accountants and they will do the negotiation and leg work on your behalf. 

Before they can talk to your bank, they will first have to review how much you owe and then come up with a plan. 

This is better known as the debt management plan. Once the banks agree to it, you have to do your share by making the monthly payment and doing a few other requirements. 

These include closing all unsecured credit accounts, not taking any additional unsecured credit, monitoring your credit card payments so you see that your debt is slowing being paid off. 

The benefit of this arrangement is that you will be able to pay your debts at lower interest rates, reduced or waived late fees and payment terms from as short as 5 years to as long as 20 years. 

What credit counselors cannot do is eliminate the stress that comes with paying bills because again, this is something you have to do on your own. They simply assisted and you have to do the rest. 

The debt management plan that was drawn up will be reflected on your credit report and there is now way it can be covered up. 

A credit counselor cannot help you if you have secured loans which involve collateral. This is because when you are not able to pay for it, the company which you got it from has the right to have it repossessed. 

One thing you have to consider when getting help is choosing the right credit counselor properly. To do that, you have to ask questions and get feedback from previous customers. 

If ever they tell you not to contact the credit bureau, do anything illegal or make false statements, walk way because this is most likely a scam.  At worse, you can even go to jail if ever you decided to go along with it. 

The credit counselor at this point is probably the only friend you have in the world and aside from striking a deal with your creditors, they will even teach you how to save money. 

You will probably be taught how to cut down on certain expenses, how to balance your budget and if you need to sell off certain assets just to pay off some of the debt. 

These changes as you know will be good for you in the long term so you just have to trust your credit counselor. 

As a client, you have rights under the Credit Repair Organizations Act and the company you are looking at should make you aware of it. It is best you read and understand it before you sign any contract. 

Credit repair and counseling go hand in hand especially when you don’t have the courage to face this problem on your own. There are private and non-profit organizations that are willing to help so you just have to find the right one. 

Credit Rating and Credit Repair

There is a relationship between credit rating and credit repair. If your credit rating is 600 or below, credit repair is needed so you will always be in good standing. 

But what is a credit rating? This is an indicator that tells creditors if you are credit worthy. A simple way of doing this is to encode certain things about you in the computer and within seconds, they will see the results appear on their screen. 

Credit rating ranges from 350 to 850 and as mentioned earlier, a score of 600 or below is bad because if you apply for a loan, you will be paying higher interest rates compared to someone who has a good rating of 700 or above and this is usually based on 5 factors. 

First, the number of inquiries you have made in the past 2 years. Did you apply for a loan or a credit card? If you did and this was approved, then as long as you pay it on time, you will have a good credit rating. 

Second, what types of credit you actually have? If you have funds, then that is good. If you don’t, well don’t expect to have a high credit rating. 

Third, what is the length of your credit? People who have a line of credit for 5 years or more have a better credit rating compared to someone who just graduated from college. 

Fourth, how much is your debt? It is okay to have debt once in a while as long as you are able to pay for it. If you don’t owe money to anyone, then good because this will be reflected on your high credit rating. 

Lastly, what is your payment history? This is somehow connected with your length of credit because this will show if you have been able to make payments on time. If you missed a payment that could be bad but if you have not, then you should have a good credit rating. 

All these five factors are equally important. So you can see if you have any problems, get a credit report from one of the three crediting agencies namely Equifax, Experian, and Trans Union.

You can get a copy from each one at the same time or do it at different times of the year. This report changes so you should obtain a copy annually. 

One thing you might notice looking at the different reports is that they may not always reflect the same thing. When this happens, don’t be alarmed because each one uses a different set of protocols in coming up with those figures. 

However, should something there be outdated or mistaken, this must be corrected. If you have the supporting documents, write a letter and send this to the credit agency. 

If what the report says its true and you are in a lot of trouble, then steps have to be taken to initiate credit repair. You can do this by yourself or with the help of a counselor. 

Regardless of who is involved, only one thing is certain and that paying off whatever outstanding debt you have is the only way to improve your score. 

Don’t expect that your loan application will be approved if you credit rating is not very good. Do something about it because credit repair is your only option. 

Credit Repair You Can Do Yourself

There is something both the indulgent spenders and those caught up in dire need can both share: the need for credit repair. No one wants to sweep everyone under the rug, of dismissing them as people who can't plan a budget and stick to it. But the truth is both those who spend indulgently, more so than they can afford, and those with medical bills and family emergencies, both may end up with a bad credit rating. No one wants that. 

The immediate thought of some is to look for credit repair solutions provided by some companies, most of which are probably scams. Anyone can improve his or her credit report, in the legal and legitimate way. But what most people want is some here and now instant solution. Naturally, some companies will jump on that need. Hence the proliferation of scam companies. But you can repair your credit standing yourself. Here are four ways to do just that, yourself. No a dime spent or scam involved. 

Have someone add you as an authorized user on their credit card. A good and certain way to improve remarkably your credit status is to have your relatives, one or two of them, to add your name as on of the authorized users of the credit cards they actively use. Getting them to do may not be easy if you're known to them as someone irresponsible, so you'd have to promise them you're straightening out your life.

The benefit getting your name added to their card's allowed-to-use list is that this comes off as a positive mark on your credit report. The usual reason is that someone trusts you to not abuse their credit card. Just be sure that the relative you ask to have you added also has a commendable credit history. Otherwise, it's a little pointless to be added to their list. That would negatively affect your credit status, instead of helping. 

Decide on a spending ceiling on your credit card. Putting a cap on how much you can spend is always a good thing. Having a record that you phoned your credit card issuer to limit your card's spending limit is often taken as a sign that you don't want to spend more than a certain limit. The limit is usually assumed to be how much you earn. This speaks of discipline and foresight. Definitely worth doing. 

Up the limit on the credit card you're using. On the other end of the credit card spectrum is increasing your card's spending ceiling. When you successfully persuade your credit card issuer to jack up your limit, that is taken to mean that the issuer has decided you are trustworthy, which often means your income is stable and can support the needed payments. This will reflect nicely on your credit status. 

Complain if you're paying a student loan. When paying up for a student loan, contact the student loan ombudsman, or the office handing your loan payments. You have to do this before you phone your creditor, because those who provide student loans have to make the payment choices convenient to those who borrow them. If you are persuasive enough, you might be fortunate to have the records of late payments removed from your account. This is a good thing. You want as few bad marks on your credit status, as much as possible. 

The tips listed here are not at all exhaustive. You are encouraged to look for more tips in shouldering and pulling off your credit repair yourself, without resorting to paying off a company that offers to improve your credit report or standing for a fee.

As has been mentioned before, most likely they are scams. Visit government and non-government websites, which are non-profit in nature, for more information. 

Understanding Credit Ratings

When we approach a lending institution to borrow money, how does the lending institution know whether we are trustworthy or not? We might be able to assure them that we are… but can they take our word for it?

The lending institution is in the business of making money by lending money. They lend money to people who they think will pay it back and they charge a bit of interest which is their way of making money on the risk they've taken. But again, how do they know who will pay the money back?

That's where credit ratings come in. A credit rating – or "a credit score" – is derived from a big pile of information collected about us. There are three main credit scoring companies out there. They are private companies who get information about us from various sources. These credit reporting agencies use this information to give us a score. Every person has their own score.

Then, when we want to borrow money, we ask a lending institution for the money and they go to the credit reporting agency and find out what our score is. If we have a good score, the lender will give us money. If we have a bad score, the lender will either give us money but charge us a higher interest rate or they simply won't give us money at all.

So, it makes sense that we should work hard to improve our score. But how do we do that? Here are some tips:

1. Pay all bills in full. Don't leave any money outstanding on a bill. Pay it in full. Credit reporting agencies, and the lending institutions that use the scores, are going to want to know this information. After all, the lenders are considering lending us money and don’t you think they want to know if you pay your bills in full???
2. Pay all your bills on time. Don't be late. Don't wait until the last moment. Pay them on time. Again, lenders who are about to lend you money want to know that you are a conscientious borrower who happily meets your obligations.
3. Make sure you HAVE a credit history. A good score doesn't just occur because you don't own anybody anything. No. People get a good score because they've owed people money and they pay it back. Someone who doesn’t have any credit score at all isn't going to get much money loaned to them.
4. Watch your available credit. Available credit is how much money you CAN borrow. For example, if you have a maximum of $10,000 credit limit on your credit card, your available credit is $10,000. Lenders want to know this because they want to find the balance between what you earn and what your available credit is, If you have lots of available credit but a low income, they might be reluctant to lend you money. Some of the might be thinking: "If they go on a spending spree, they'll never be able to pay it all back."

Getting good credit is a strategic, time-consuming effort but it pays off if you want to borrow money.

Credit Repair On Your Own

Drop that “I can’t do this alone attitude” attitude. You can do credit repair on your own. All you need is the proper knowledge to do so. Acquiring the information is the key. You need to do some or a lot of research and studying before you tackle repairing your credits, though. The amount of time and effort you will give on this project depends on the foundation of your knowledge on credits, repair and financial management. 

The first thing that you will do is get all your credit reports and study them. Credit reports are free so get as accurate report from credit bureaus. Your creditors submit these reports so you should be able to get them with no problems whatsoever. The credit bureaus will usually want copies of the same report so it would be best to make copies for yourself and do action plans using the copies. Looking at the credit reports, correct whatever entries that you think are questionable or incorrect.

This is the time to correct and clarify entries on your reports. Dates, credit limits, and the actual amount owed are the things that you should look closely and make sure that everything is correct. If you find some inconsistencies, write a letter to the creditor and credit bureaus to show that you have some problems with entries in your report. Registered mail is always the ideal situation since you will be sure that they received the letter. 

Looking into your credit report, make sure that you evaluate the last 12 months at least. The credit score is determined usually from the last 12 months of your credit history. So it is important that you have made some payments on your debts last year or so to give you a better credit rating. Credit companies never like having default loans. That is why you should always come up with your creditors a doable payment plan so you won’t miss on payments. Review or get back to the original creditor instead of dealing solely with the collection company to ensure that your payment records are straight. 

After you procure the reports and have ensured that everything is in order, you will then undergo the process of reestablishing your credit rating if it is too low already. This is the actual process of repairing your credit standing. The importance of repairing one’s credit standing lies on the fact that it will dictate future credit and loan applications. Even simple credit card applications and purchase can be affected by present credit standing.

Having a low credit score can mean better loan conditions such as low interest rates and a longer credit term. Needless to say, having a low credit score will definitely make it easier for your financial future. Remember that even basic utilities and even employers are now conscious of credit scores unlike years earlier when banks and credit companies are the main parties concerned. 

In repairing your credit standing, you will need to make sure that you pay bills on time. Loans and credit card payments would be the most important thing that should not forget. Creditors will look very closely on how well you meet your financial obligations so make sure that you won’t miss out on anything. The more times you miss paying bills and loan payments the lower your credit score will become.

Nonetheless, you can accomplish credit repair on your own with the right commitment. This is something attainable. 

Credit Repair for the Clueless

If you're new to credit card repair, don’t' despair. It's not that to understand what this is about. And neither will the instructions and tips here be impossible to figure out. May people think, mistakenly, that so long as they keep paying bills on a timely manner, their credit status will be fine. But sometimes we fall back on hard and harder times, and we miss out on payment and end up with the need to do some credit repair. We all want a good credit status. So the more one knows about repairing one's credit status the better. 

Right now the economy is hurting, credit card companies are feeling the pinch, and the lending sector is frozen solid for people who need to borrow to sustain their needs. Keep that in mind as it maybe a bit harder this time around to pull back from the abyss of having spent so much, much more than one can earn. Here are important aspects of credit repair concept you should know about. 

Your credit score. This is not merely another figure. Your credit score is affected by many things and so you try to avoid those that negatively affect it and find out and implement those that improve it. Improving your score can involve some action on your side and from other people who trust you.

One way to pull up your credit score is to persuade some relatives to put you on the list of people authorized to use their credit cards. It's a good mark on your report when a credit company sees that. That usually means someone trusts you enough to let them use their credit card. That means either financial stability or some discipline in spending. 

Your credit reports. You need to be aware of the accurate score, so to speak, of you transactions, from your credit card company or companies. Knowing where you stand allows you to plan ahead and provide you with some calmness in facing the storm, or the rehab process if you've spent more than your income and maxed out a few credit cards.

Usually you are entitled to a free credit report, just ask for it. When you do get it, though, read it cover to cover and try to have a list of questions about what you're not clear about concerning your report. That will save time in phoning your credit card company and asking questions or talking about your disputes. 

Creditors and collection companies. You have to keep the lines of communication open between the people you owe money and the people who collect on their behalf. Doing so is a sign of openness and a willingness to work things out. Besides, the collection company will often take whatever you can give them. So don't close your doors and hide from them. That would only send the wrong signals and mar your credit status even more. Remember that you're aiming to repair it, not tarnish it even more. 

Identity theft. Some people were victims of this. Someone bought using their names and they had to pay for the consequences. You have to protect vital personal information so that nobody goes around buying in your name. You have to dispute charges you didn't shoulder yourself. That's one reason you have to talk to the credit card companies about your free credit reports. 

Laws and litigation. You must be aware of ways to legally protect your interests against unlawful practices of some credit card companies and their collection people. That way, you're prepared and informed and won't be forced to do things not in your better interests. 

If you're trying to find a way to do the credit repair yourself, it's advised that you do it yourself and not rely on companies whose tips and efforts you will shell out money for. After all, you don't want to be scammed.

Remember that the very money you may be using to pay for their services you could already be trying to use to settle existing accounts and maxed our credit cards. It's best to do some research yourself.