What Exactly Is Credit Repair?

When most people think of credit repair they think of credit bureau disputes. Historically, credit bureau disputes have been the heart of the credit repair process. It turns out that it is really just a first step.

It is a reality that many people are faced with the difficult task of credit repair. They may have found themselves overextended on their credit cards, have some late payments, and even some collections because of a job loss or medical problems. When it gets to this point, it can be very overwhelming to get back on track. Credit repair takes time, patience, and discipline, but it can be done.

First, you need to obtain a copy of your credit report from either one or preferably all three of the major credit reporting agencies. The “big three” are Experian, Equifax, and TransUnion. They can be found quite easily on the Internet and will provide you with a copy of your credit report.

The FACT Act that was passed by Congress back in 2001 allows all consumers one free copy of their credit report per year. For this, you will need to go to www.annualcreditreport.com and request yours. You can request one from each bureau every 4 months or print all 3 at once.

However, if you see errors on one, then you will really need to obtain copies of all three credit reports. Creditors are not required to report to any or all of the agencies, and often they will just report to one. Having all three credit reports on hand will help you make corrections to your credit more effectively and more thoroughly.

Once you have these reports in hand, go over them “with a fine tooth comb”. Check for any errors such as accounts that have been paid off but are still appearing as delinquent or accounts that you never opened or used in the first place. Also, verify your credit card limits are reporting correctly. This is an important factor that goes into your score. If you do find errors on your report, it is essential that you contact the credit bureau to make the correction if you want your credit repair efforts to be thorough.

After checking your credit report, the essential part of making improvements to your credit report and score is to change the way you are using credit. That includes making all payments on time and not using credit when you can't afford to make the payments. While it’s true that it’s virtually impossible to go through life today without using credit, you can use it wisely and not end up in trouble down the line. The best uses of credit cards are for emergencies and for the benefits (airline miles, cashback, etc.).

Repairing your credit is not a difficult task, but it does take a lot of time and patience. Truly what you need to do is simply take steps to evaluate your use of credit and then see where changes can be made. Then not only will your credit be improved, your credit score will increase as well.

Expert Credit Consultants, LLC specializes in credit restoration and optimization.