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Tips and Tricks to Avoid When Doing DIY Credit Repair

You may be thinking about how you can improve your credit if it is weaker than you would like. Credit repair agencies are generally not worth the money, as we have discussed before.

People sometimes seek credit repair from professional companies as a result of this. Despite that, they cannot provide value, but their services aren’t free or guaranteed, and they cannot do anything that you can’t do yourself. But you can also do it yourself (DIY) and hire a professional for credit repair, similar to debt settlement. Using DIY methods will save you money and keep you safer.

 

So, let’s examine some ways to improve your credit without hiring an agency. A few tactics to avoid will also be discussed.

 

Overview

You should familiarize yourself with the credit landscape before you attempt any credit repair. Your credit report and score are the two main components that make up your credit score. The information in your credit report is analyzed by an algorithm that determines your credit score. In order to improve your credit score, you will need to improve the information in your credit report. You have seen this image many times, but remember that these four components make up your FICO score:

FICO
source: https://www.creditlawcenter.com/

 

A credit report is the first step to determining your score since it is based on the information in it. Since each of the major credit bureaus may have unique information, pulling your credit report from all three may make sense if you are proactively trying to solve an existing credit issue. As an alternative, you can check your credit report every four months from one bureau for free at annualcreditreport.com when you are just maintaining your credit status. To help consumers keep an eye on their credit reports and watch for identity theft and fraud, AnnualCreditReport.com allows consumers to pull their credit reports weekly for free from all three credit bureaus through April 2021.

 

You can then work towards improving your credit score by reviewing your credit report.

 

It is important to dispute misinformation about credit repair

A mistake on your credit report can be challenged and you can request it be removed from your report. Not only must the information be incorrect but it also must be inaccurate. A credit report cannot be unilaterally removed with accurate and permanent negative information.

 

You have a few options for disputing inaccurate information.

Each of the three primary credit bureaus has developed an online dispute system.

  1. Disputes with TransUnion
  2. A dispute between Equifax and a consumer
  3. Experiencerian disputes

 

However, the FTC still suggests disputing over the mail. Your dispute will have a clear record of the dispute, so this may be beneficial. There is a template for dispute letters on the FTC’s website. Whatever method you use, make sure to keep copies of any correspondence, and that you receive a response from the bureau within 30 days of filing your dispute.

Credit Repair: Send goodwill letters

Your credit score can be hurt by accurate and negative information. There is no reason to use the bureaus in such a situation since they are responsible for reporting accurate information provided by creditors. As a result, you will need to wait for the relevant period of time (usually seven years) to pass before the negative information drops off.

 

The creditor may be able to offer you leniency, however. ¬†As longshot as this may seem, you are right. . But this strategy can be successful sometimes, so it doesn’t hurt to try. By submitting a goodwill letter to your creditor, you can make this appeal. An individual writing a goodwill letter directly requests that a creditor remove the negative information on his or her credit report. In order to increase your chances of success, you should provide a compelling explanation of why the payment(s) were missed, and/or show that you have made consistent payments since the late payment. The Goodwill Letter Template from NerdWallet is helpful.

 

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