How to Repair Bad Credit

Friday, May 10, 2019, 6:00 AM | Leave Comment

The importance of a good credit score cannot be overemphasized. It will help you to qualify for lower interest rates and better credit terms, pay less insurance premiums for your vehicle, get an apartment for rent, and even pay a smaller deposit for utilities when they are being installed in your house.

On the other hand, having a bad credit can be such a burden, putting your financial goals at risk and making other goals, like hiring a building for business, unattainable.

Here are some strategies you can use to repair your bad credit:

  • Dispute any issues in your credit reports

    You need to obtain copies of your credit reports from all the major credit bureaus—Transunion, Experian, and Equifax. Read through each entire report carefully.

    While reading your reports, highlight incorrect information that you want to question—for example, accounts that are not yours, wrongly reported late payments, accounts that are past the limit, and so on. You are entitled to dispute any information you think is incorrect, incomplete, or that which cannot be verified.

    Disputes can be lodged online, especially for online reports, but you can also do it through emails or over the phone.

    It is vital to note that online disputes and those done over the phone leave you with no trail or material for future reference. As such, disputing via email is better, as you can retain a copy of the dispute letter as well as send supporting evidence, like canceled checks, to demonstrate that you make payments on time.

    In addition to sending your dispute to the credit bureaus, you can send them to those who have listed you with the bureaus. These entities also have an obligation to investigate and clear the mistakes.

    The bureau will update your report with the successful disputed issues and send you a new copy, and if unsuccessful, you still get the chance to add a personal statement to the report, although this does not affect the score.

  • Engage credit repair experts

    One of the ways to repair or rebuild credit is to become an authorized user on a credit card account of someone with an excellent score.

    You will benefit from the good credit of a friend or relative when added to their accounts. However, if you do not have someone to help you, this is where the credit repair companies come in.

    You can engage credit repair experts like Boostcredit101 to sell you trade lines, meaning you will be added to someone’s account to improve your score.

    The beauty of using trade lines is that they boost your score faster and often dramatically. The credit repair experts can also help you to remove information that is causing your score to drop.

  • Deal with past due accounts

    Having tackled any misinformation on your report, you need to ensure your accounts that are past due are marked paid. It is vital you become current with accounts that are already past due, but that are not yet charged off (this happens when your account is 180 days past due).

    Prevent those payments that are less than 180 days late from being charged off by settling the overdue amount. You can also talk with your creditors to see how you can get back to being current, and most of the time they will assist, for example by spreading the overdue amount over several payments.

Final words

Repairing a bad credit score is a time-consuming process, but a very crucial one, as having good credit leads to tons of benefits. You can repair your poor credit by reviewing your credit report and disputing any issues, engaging credit repair experts, and settling overdue accounts.

About the writer

Steve Patrick is a freelance writer who is greatly experienced in researching and writing on various topics. He has a keen interest in personal finance and specifically in credit.

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