Repair Your Bad Credit Now
Written by: Kristy Welsh
Have you thought your credit report wasn't that bad only to find out it is in terrible shape? Did you recently apply for a mortgage and was told by the lender you had to put down 25 percent because your credit score was too low to qualify a lower down payment?
You are not alone. Thousands of consumers are affected one way or another by bad credit. It could be in a higher interest rate, higher car insurance rates, did not qualify for a home loan, or you were denied a credit card. In today's tight economy, it is more important than ever to have good credit.
How to Repair Bad Credit
It is not as hard as it may seem. If you have a little extra time and some persistence and patience, you can raise your credit score by upwards of 200 points. If you do not have the time, and we know all of us get caught up in "life" and time seems to be a scarce commodity, there are numerous agencies that can help you for a fee. One such agency we have come to know and trust is Lexington Law. They have been helping consumers fix their bad credit since 1991 and they have removed over one million items from credit reports.
Here are the basic steps to repair bad credit.
- Get your credit reports.
- Analyze your credit reports.
- Rank questionable/negative items.
- Send out dispute letters to the three credit bureaus.
- Send all correspondence out registered/certified mail.
- Document your efforts.
- Wait for the bureaus to respond to your letters.
- Evaluate the findings/deletions by the bureaus.
- Repeat the process by sending out dispute letters again.
- Send out specialized letters, if necessary.
Get Your Credit Reports. You will need to obtain your credit report from all three bureaus, Equifax, Experian, and TransUnion. Or you can obtain all three reports from AnnualCreditReport.com. Be careful when requesting your reports as some companies will try to have to sign up for a credit monitoring program. Make sure to read the fine print before you sign up with one of these companies, as they will charge you a monthly fee for their services in exchange for a free credit report or free credit score.
Analyze Your Report. Now that you have your credit reports in front of you, what do you do next? Look through each one carefully and you will notice they categorize the entries in "positive" or "negative" sections. Highlight or make notations on entries that are "negative" so you can quickly get to them once you are ready to start to send out the dispute letters. After you have identified all the negative marks on your credit, now it is time to start to write the dispute letters.
Decide What to Dispute. You are going to be mailing out to each credit bureau itemizing the disputed items. These items need to have the agency reporting the negative information, the account number, and the reason you are disputing this entry. Click here to view an example letter. Each one of these letters needs to be mailed certified/signature requested. This way, you can ensure the bureau received your letter and you will start the "30-day" clock on the day they signed for the letter. It is imperative you keep all of this documentation.
Wait For Results. In approximately 30 days, you will be receiving replies back from each bureau. You will actually be receiving an updated credit report. Compare this new report to the one you originally printed - you want to note the items that are now "removed" and the items that are still on your report. The items remaining can still be disputed by running through this process again. Persistence is key and "the squeaky wheel gets the grease." Keep this process going until you have removed all the items you possibly can. Now some may not come off because the bureau has verified them but that is not to say you can't keep trying. Also, you may have to send some specialized letters to collection agencies or banks to remove any remaining negative items.
Have Patience. This process can take 6 months to a year to get everything cleared up - but the energy and time you spent will be well worth it. Now, when you go to the car dealer or apply for that home loan, a low credit score will not surprise you. Instead, you will have the satisfaction of knowing you have a very good credit score and you can get the loan you want - and deserve.