If you have less than perfect credit, odds are you’ve had someone recommend credit repair to you. You’ve heard them say that it can help improve your credit. They’ve told you that credit repair can boost your score, finally making it possible for you to buy a house or get that new car you’ve been eying for years.
But what is credit repair and what exactly does it entail?
Even if you’ve had several people recommend credit repair to you, I am sure you are hesitant to proceed with it if you don’t really know much about it. That is understandable. So let me help you out a little bit. I’m here to explain some of the ins and outs of credit repair to you.
Why people need credit repair
So first things first, how about we start from the beginning. Why would someone even need credit repair? Well many people (in fact, the majority of Americans) have errors on their credit reports. Those errors are negatively affecting their credit reports, bringing their scores down, causing them to have lower scores than they actually deserve. These lower scores are preventing them from being approved for loans or new lines of credit, and they are causing them to be charged much higher interest rates than they deserve. These inaccuracies on their credit reports are costing them hundreds to thousands of dollars.
How credit repair works
That is where credit repair comes in. People don’t want to keep these incorrect items on their credit reports. So they go through the process of credit repair (either by doing it themselves or hiring a company to do it for them) to work to get these inaccurate items fixed or removed from their credit reports. As these inaccurate items are removed, their credit reports improve, giving them the higher credit scores they deserve. They are then able to get new lines of credit and better interest rates with their better, more accurate credit.
What credit repair entails
So what does the process of credit repair actually entail? How do you find these inaccurate items, and how do you work to get them removed from your credit reports? Well credit repair starts by ordering copies of your credit reports (this can be done for free online) and then scouring through those credit reports to find any items that are inaccurate, misleading, incomplete, untimely, or unverifiable.
If you feel that any items on your credit reports fall under one of these criteria, you can work to have these items corrected or removed. You do this by sending a letter to your creditors that have listed the item in question. You explain to them which item you are disputing, why you are disputing it (what criteria it falls under), and you ask them to correct or remove these items. If it is true that the item is actually inaccurate, misleading, incomplete, untimely, or unverifiable, your creditor is required (by law) to have this item removed or updated for you.
The benefits of hiring a credit repair company
You absolutely can work to dispute negative items on your credit reports on your own. But many people choose to hire a credit repair company to help them with this process. A credit repair company will communicate with the credit reporting companies on your behalf to work to get these items removed for you. So why would you spend the money to hire a credit repair company to do something that you can do yourself? Because, just like with many other things, sometimes it’s worth it to pay for experience.
You see, credit repair companies have years of experience working to get inaccurate items removed from people’s credit reports. With this experience comes expertise and success. They know how to read the credit reports to find which items should be disputed. They know how to properly write and send the letters out in order to actually find success in getting items removed. They know how to be persistent, and how not to get discouraged. All of these things could make a huge difference in the amount of items that you are actually able to get removed.