Credit Repair Questions and Answers
Can I repair my credit report myself?
Yes. It's your legal right and you are also encouraged to work out your credit disputes with the credit agencies and creditors yourself. Fixing your credit yourself is not rocket science. Everything credit repair companies can do for you legally, you can do for yourself at little or no cost.
When it comes to credit repair, persistence is what triumphs. If you are willing to invest the amount of time and follow-up required to coordinate disputes with all three credit reporting agencies and the creditors appearing on your credit report, then go for it.
Is credit repair legal?
Although the Credit Bureau would like to have you think otherwise, there is absolutely nothing illegal about disputing questionable items on your credit report. In fact, it is your explicit right by law to do so (see Fair Credit Reporting Act).
Moreover, the federal Fair Credit Billing Act affords consumers the right to request extensive information regarding billing and account history. The Truth in Lending Act stipulates conditions for establishing credit accounts. And, finally, the Fair Debt Collection Practices Act allocates specific rights to citizens regarding accounts that have passed into collection status.
Does paying my bills restore my credit?
You would think that would be true. But, again, the credit reporting system just doesn't work that way. When you pay an old debt, the negative credit listing doesn't disappear. Once paid, it may appear on your credit report as a paid delinquency, charge off or collection. You won't get very far paying your debts unless you also work to restore your credit at the same time.
Do I need to pay my bills?
If there are delinquent accounts appearing on your credit reports that have not been paid off, the actual debt behind the listing remains the same even if the account is deleted from your credit report. You may still owe the same money that you validly owed in the first place subject to your state's applicable statute of limitations. If you don't pay the debt, the creditor or a collection agency may re-report the item. So removing the listing without addressing the debt is only a temporary solution. It's advisable that you only dispute credit listings that you feel are inaccurate, unverifiable or misleading. If you feel that a negative credit listing is 100% accurate, timely and verifiable, then you shouldn't dispute it.
What does it mean to have perfect credit?
In the US, a consumer with a perfect credit is someone with a credit score of 800 or higher. Yes, there are people with credit scores over 800. An estimated 13 percent of the population fall into that category. However you don't need to have a score 800 to get a loan or good interest rate. Knowing what the credit profile of a consumer with an 800 score will help you build your own credit.
What if deleted items reappear?
On occasion, a negative listing that was recently deleted may eventually be verified by the creditor. The Fair Credit Reporting Act requires that the credit bureau inform you before the re-report a previously deleted listing. The FCRA also makes it more difficult for Credit Bureau to re-report listings. Because of these factors, it is fairly rare for listings to come back on once they've been deleted. If a questionable credit item is re-reported, it is a simple matter to challenge the listing again at a future time to press for permanent deletion. This is why keeping good records is very important.
How much does bad credit cost?
Here are just a few examples of the cost of bad credit. A low credit score can cost you hundreds of dollars per month.
Can I remove a bankruptcy?
There is not one type of negative listing that cannot be removed from a credit report if it is questionable and disputable. While negative items such as bankruptcy or unpaid debts are certainly more difficult to remove from the credit report. For example, judgments and tax liens are severely negative listings yet have been considerably easier to remove.
What are Civil judgments?
Civil judgments are cases where a collection agency, credit card company or lender takes a consumer to court over unpaid debts.
How do Civil judgments affect my credit?
With the new credit standards that went into effect July 1, 2017, civil judgment and tax lien information no longer shows as part of a consumer's credit history.
How do I order my free report?
The three nationwide consumer reporting companies are using one website, one toll-free telephone number, and one mailing address for consumers to order their free annual report. To order, click on AnnualCreditReport.com, call 1-877-322-8228, or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. The law allows you to order one free copy from each of the nationwide credit reporting companies every 12 months.
Is there a charge for my report?
Under the Free File Disclosure Rule of the Fair and Accurate Credit Transactions Act (FACT Act), each of the nationwide consumer reporting companies, Equifax, Experian, and TransUnion are required to provide you with a free copy of your credit report once every 12 months, if you ask for it.
What information do have to provide to get my free report?
You need to provide your name, address, Social Security number, and date of birth. If you have moved in the last two years, you may have to provide your previous address. To maintain the security of your file, each nationwide consumer reporting company may ask you for some information that only you would know.
I received an email offering me a free credit report. Should I request my free report through them?
No, annualcreditreport.com is the only authorized online source for your free annual credit report from the three nationwide consumer reporting companies. No other company or website or email can issue your free credit report. If you get a phone call or an email claiming it’s from annualcreditreport.com (or any of the three nationwide consumer reporting companies), it’s probably a scam. Don’t reply or click on any link in the message. Instead, forward any email that claims to be from annualcreditreport.com (or any of the three consumer reporting companies) to email@example.com, this is the Federal Trade Commission (FTC’s) database of deceptive spam.
I am making reduced payments on my loan. Will that affect my credit?
Some credit counselors will tell you it is possible to make reduced payments to your creditors without it affecting your credit rating. (the better to pay something than nothing scenario) This is not usually the case. Most creditors will add to your credit reference file to show that you are behind with your payments even if they agree to your offer.
I want to buy a new home. How can I increase my credit score and how long will it take?
There is no fast credit repair or magical way to improve your credit score but over time. However to speed up the process, here is the best way to fix credit.
1. Pay your bills on time.
2. Pay down your existing debt
2. Do not take on too much debt
3. Get a copy of your credit report and dispute any negative incorrect entry on your report.
4. Maintain low balances and get all of your credit cards under 30% of the total available credit
As far as how long it takes, it all depends on what's on your credit report. You credit will improve drastically when your credit card bills are paid down or a major negative entry like medical bill is removed from your report. Your score will probably raise anywhere from 80 to 100 points. Here are more tips on improving your credit score.
How long does negative information stay on my credit report?
Typically, the negative information on your credit report tends to fall off after 7 years, or 10 years if you've been through bankruptcy.
How long does Positive information stay on my credit report?
Positive information remains on your report for an average of 10 years from the day that account is closed. This applies to loans like mortgages and car loans. For revolving accounts, such as credit cards, your positive history will stay on your report for as long as the account is active.
|How to order a free credit report||Dealing with Credit Bureaus|
|How to repair bad credit yourself||Profile of a Perfect Credit|
|How to Improve your credit score||Credit & Marriage|
|How to dispute negative credit||Know your legal rights|
Did you know ....
As of April 2018, all tax liens or outstanding debt you owe to the IRS no longer appear on credit reports can no longer impact your credit scores.