Credit repair is a legitimate process that helps consumers who have recently been damaged by fraud in their credit history. The Fair Credit Reporting Act makes it illegal for any company to sell and produce a credit repair item to consumers. However, there are many fake credit repair service providers who are making false promises to consumers. They charge consumers for things like credit monitoring services and credit dispute letters that do not actually help you. Consumers need to make sure the company they choose provides genuine credit repair services.
To understand how credit repair works, it is important to have some background knowledge of credit history. A good credit score indicates that the consumer has a history of making payments on time and debts have been repaid in full. In case the credit score is low or there is even a doubt about a person’s creditworthiness, it is advisable to get a copy of one’s credit report. This is the best way to check what information is being reported and how accurate the information is. When there is even the slightest doubt about the creditworthiness of a person, it is best to get a copy of the credit report to know if there are any errors.
It is important to note that credit repair does not work on credit reports that are inaccurate or have incorrect or false information. These errors must be disputed with the credit bureau concerned. This is the only way to ensure that the credit bureau corrects the information. It is necessary for consumers to request a credit report which has correct information on the basis of their credit history. Consumers can also get these credit reports from credit reporting agencies and credit repair companies. This method does not save one from spending money as the fees charged by these companies are generally quite high.
There are instances when people may not be able to obtain accurate credit reports because there is some sort of inconsistency. For instance, if someone had sold his property within a short span of time but is still having difficulties in receiving credit cards, this would show up on the credit reports which would not help one get credit cards. Such inconsistencies which do not affect a person’s credit history are referred to as negative information. The credit repair services deal with this negative information on the basis of the credit history which they have obtained from a credit bureau. They check if the information is accurate and whether the credit report needs to be disputed.
Before disputing a credit report, it is best for a consumer to understand the entire process. Sometimes a credit repair service or a credit repair company advises a consumer to dispute the item or items which should be removed from credit reports according to the Fair Credit Reporting Act. They suggest various legal ways to do this. However, it is important to note that every individual has to follow the legal rights given to him according to the FCRA.
There are many people who are under the impression that it is easy to delete negative items from credit reports and that they can do so without involving a credit repair service. This is not true. The Fair Credit Reporting Act clearly states that no person shall be denied credit or employment based on false or inaccurate information. If you are not sure about whether the information reported by the credit reporting agencies is correct or not, you can check it yourself using the details provided on the FCRA website. There are detailed instructions about the process of disputing inaccurate items.
Once you have all the required information, you should check the accuracy using the free credit report websites. There are many companies that claim to offer free credit reports on the Internet. However, these claims are false and misleading as they cannot guarantee you a free credit report. There are two types of free credit reporting agencies – those which provide the reports on a monthly basis and those which provide the reports only after a certain period of time. It is advisable to use the latter option.
To successfully carry out credit repair activity, you should take the help of a credit repair service provider. A credit repair service provider will help you in three ways – by improving your credit score, by informing you about the flaws in the credit report, and by clearing off the disputed items from your credit report. If you follow the instructions provided by the credit repair provider and use the credit repair service regularly, you will be able to improve your credit score gradually. Once you improve your credit score, you can apply for a new mortgage or loan, open a new bank account and get a job. Hence, credit repair is very important for all consumers today.
This post was written by Kristian D’An, owner of Lux Credit LLC and CCA board certified credit repair specialist. Lux Credit offers credit repair services for those looking to improve their credit! Click here for more information.