The question I get asked all the time is, What is Credit Repair? My answer has changed over the years, and I find it to be much more helpful now. Credit Repair is the process of using consumer protection laws to dispute the validity of accounts on a credit report. It involves communication with creditors and credit bureaus to ensure the accuracy and validity of the debts and the reported balances. Errors do occur and can have an unfortunate effect on the consumer's credit. Credit Repair is the tool to help uncover and dispute these errors. It is an invaluable process and understanding the laws surrounding it can be incredibly beneficial.
Table of Contents
Which credit repair method works best?For whom is credit repair intended?What is the importance of Credit Repair?What types of problems can Credit Repair address?
Which credit repair method works best?
Determining the credit repair method that works best depends on individual circumstances and needs. However, some effective strategies include obtaining and reviewing credit reports for errors or discrepancies, disputing inaccuracies with supporting documentation, making timely payments to demonstrate responsible financial behavior, reducing overall debt by prioritizing high-interest balances, maintaining a low credit utilization ratio, avoiding unnecessary new credit applications, and seeking professional assistance when needed. By combining these approaches and customizing them to your specific situation, you can increase the likelihood of successful credit repair and improvement.
Send out dispute letters on your own
If you have the time and patience to research the credit repair process and the applicable laws, then you can send out your own disputes. It is important to understand the credit reporting regulations that are in the Fair Credit Reporting Act (FCRA) and the Fair Debt Collections Practices Act (FDCPA). Having an understanding of these laws will help you to approach each negative account on your credit report correctly and come up with the best approach on how to dispute the accounts.You want your dispute letter to be unique and not something that has been sent to the credit bureaus before. When disputing, it's important that your 1st Dispute letter go out to the (3) major credit reporting agencies Equifax, Experian, and Transunion, and wait on their response before you send a dispute out to the data furnisher like the original creditor or a collection agency. The Credit Reporting agencies and data furnishers are required to respond to your disputes within 30 business days, or they must remove the account or reporting error from your credit report immediately.Additionally, it is recommended that you always send your dispute letters by certified mail so you have a provable time stamp that you can use in case you ever need to file a complaint or a lawsuit. Always keep records of everything you do within the process.
Use an online Dispute tool or Software
Using an online dispute tool Like Credit Karma or submitting an online dispute with the three major credit reporting agencies is not recommended. What most people find out the hard way is when you dispute online, in general, you actually sign off your rights to redispute any item on your credit report for an entire year. Since most credit disputes aren’t resolved until after 2-4 rounds of disputes, if you do not like the outcome of your first dispute, then you will not be able to rechallenge or redispute for an entire year.I would avoid ever doing any online dispute if you're truly looking to get the best results from your credit disputes.
Hiring a credit repair company
There are both pros and cons to hiring a credit repair company. Just like most industries, there are good and bad apples, and you really need to make sure you do your due diligence before selecting the right credit repair company for you.
Pros of hiring a credit repair company
They have the expertise and experience to help you get resultsRemember, when you hire any company in any industry, you are paying for convenience and expertise. If you find a really established company with a proven track record, it can be worth every penny.
Handoff ExperienceYou typically will get to “sit back and relax,†meaning your involvement in the process is usually not necessary so you can focus on things in your life that are more important.
Education Credit LearningA lot of credit repair companies will provide a credit consultation so they can provide you with information on exactly what is affecting your credit score, along with things that you can do to improve it quickly.
Help with complex situationsEvery credit report is different, and sometimes it will take someone who has dealt with certain circumstances to use their expertise to get some of the harder accounts removed.
Save moneyOne of the ultimate goals most people have for the reason to fix their credit is to be able to use their credit to make purchases at a decent and low-interest rate. Credit issues can cost you thousands of dollars annually in fees, and so by just removing errors and increasing your credit score, you will save a lot in the long run.
Cons of hiring a credit repair company
No ResultsJust like with anything that isn’t Guaranteed, you will run the risk of not getting any results and paying money essentially for nothing. Credit Repair is never guaranteed, so it's important you know what you're getting from the credit repair company before you hire them. Ask very thorough questions and also see if they provide a money-back guarantee.
ScamI have been in the industry a long time and have run a very successful company because of the standards and mission statement that I live by daily. Unfortunately, there are a lot of fly-by-night companies in our industry that do not last long, and you could fall victim to someone taking your money, and you never have any recourse. Do your due diligence, ask the company to provide a copy of their license as well as find out how long they have been in business.
ExpensiveSome credit repair companies are very affordable, but others can charge outrageous fees. A lot of people struggling with their credit usually are also struggling financially, so it's important if you do not have a lot of money to put towards credit repair that you shop around or try to do it on your own.Look, the wonderful thing you have as an American is the capability to choose and make decisions. Write down all your questions when it comes to fixing your credit and pick a solution that fits you best. Never settle, and always do your due diligence and research.
For whom is credit repair intended?
Anyone who has any negative items on their credit report should consider credit repair. After having worked with over 22,000 clients in 10 years, I have seen people go through life paying higher interest rates because they were unaware that credit repair is not only for accounts that are not theirs. There are companies offering a free credit consultation that can help identify errors or discrepancies on your credit report.I discovered this truth the hard way, but it has helped me to perceive credit differently. Your credit score does not necessarily determine your approval for a loan, but instead, your credibility does. The score merely decides the tier of interest rate you will receive. How cool is that? Most people believe that the score is the only factor in getting a loan, whereas, in actuality, it is the items on the credit report that matter. I recall a client of mine with scores in the high 700s being rejected for a loan. It is surprising, but many lenders are not too keen on seeing a lot of recent credit inquiries as it raises suspicion of the borrower having already been approved for the same loan elsewhere.In conclusion, you should check your credit report online at least every quarter and file a dispute if you find anything derogatory.
What is the importance of Credit Repair?
Seeing my many years of experience with credit reports, it's easy to recognize why credit repair is necessary. Beyond the need to be able to receive a loan, it is essential to stop bad habits from causing you financial harm. When I speak to my clients, I remind them that credit repair is only one of many tools to help you repair your credit. It can't solve all of your financial issues. Credit repair can help you remove negative accounts from your credit report, which can boost your score, and it can also help you remove any debts that are not legally yours. Credit repair is a crucial tool to help you repair your credit and avoid paying compounding interest for the rest of your life.If you have bad credit, it could prevent you from doing the following: obtaining a job, insurance, home or car loan, credit card, renters insurance, or even being approved by utility and phone companies. Additionally, it hinders your ability to save money and grow your wealth. Therefore, it is important to repair your credit early as it allows you the chance to retire early and give your future generations the opportunity to succeed. Start repairing your credit today for a better tomorrow!
What types of problems can Credit Repair address?
Credit Repair can help you address any inaccuracies or errors on your credit report. It is essential that you review your credit report thoroughly and identify any discrepancies. Highlighting any potential inaccuracies is the simplest way to identify them. The most common areas to dispute are your personal information, negative accounts, late payments, public records, and credit inquiries. Ensuring that your name, address, and date of birth are correct is paramount. Additionally, any negative accounts or late payments should be disputed, as they can have a negative impact on your credit score. Any public records, such as bankruptcies, should also be disputed, and all credit inquiries should be validated to ensure they are accurate. By keeping an eye on these items, you can maintain a healthy credit score.
To conclude
Having a good credit score is the foundation for building wealth. Unfortunately, our own laziness and lack of knowledge can prevent us from taking action to improve our credit scores. If you're looking for help or even just some free advice, check out my company ASAP Credit Repair. We are a nationwide family-owned and operated business, fully licensed and bonded, and offer a money-back guarantee on almost every service. Plus, we offer a free consultation and evaluation. Take the first step and visit us at <a href="https://asapcreditrepairusa.shortcm.li/9a4hSz"></a> to get started. Let me know if you have any questions, and I'd be happy to guide you through the process and give you advice along the way.