How to Start Credit Repair

by HomeLoan.com
Just the thought of going through the motions of repairing credit and credit reports can be overwhelming. Because it takes time and patience, some people don't start the credit repair process. Whether it's because of fear of what's on their credit report, or lack of understanding on how to begin the process, too many people live with unresolved credit reporting errors.

Step 1

Get a copy of your latest credit report. The first step toward credit repair is knowing what's on your credit report. No matter how scared you are to see what's on there, it's the only way to begin the repair process.

Step 2

Sift through the information on the report. The first thing you should check is that all of the accounts listed on the credit report actually belong to you. After confirming that they are all your accounts, look for things such as late payments, judgments, liens and other derogatory information. If you find incorrect information, you must take steps to correct it.

Step 3

Put together documentation to support your case. When you start your credit repair, you need to have supporting documentation such as canceled checks, bank statements, credit card statements and other such documentation that helps prove your case about the incorrect information.

Step 4

Contact the creditor and the credit bureaus. Write letters to the creditors and the credit bureaus outlining the incorrect information and explaining, in detail, what actually occurred. Include pertinent information such as the account number, creditor name and amount in dispute. The more information you provide, the easier it will be to resolve. Make sure to include copies of your supporting documentation.

Step 5

Follow up for resolution. The resolutions won't happen immediately, so you will have to keep on top of the process. By law, the credit reporting bureaus must respond in writing in 30 days advising if they will make the corrections to your credit report. If you haven't received a response in 30 days, follow up.

Step 6

Pay down your outstanding balances. While the creditors and the credit bureaus are correcting incorrect information on your credit report, it's time for you to do some damage control. In addition to paying your bills on time, make an extra effort to start reducing your outstanding credit balances. Your credit score is directly affected by the amount of debt owed to the total credit available. For example, using of $1,000 of an available $5,000 credit limit is much more favorable than owing $4,800 of $5,000 total available credit.

Tips and Warnings

  • Credit won't repair itself. Unless you take the steps to start repairing your credit, your credit profile won't improve.


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