Credit Repair Made Easy
If your credit is less than perfect, Life House Financial is here to help. Even though there is no magic fix to repairing your credit, there are steps which can be taken to remove the negative inaccuracies off your credit report. Beyond just removing negative reporting accounts, there are also steps you can take to build-up your credit history and improve how you look to potential lenders.
Once you've decided to take action, you'll have two basic options to consider. You can complete things on your own, or you can hire an experienced company. While the price credit repair companies vary, doing things on your own is free. As a company dedicated to protecting your best interests, we highly recommend you first try completing this process on your own. If for whatever reason you get overwhelmed during the process, you can always hire a credit repair company later.
How to Build a Credit Score That Lenders Will Love
The first step in restoring your credit is to know exactly where you stand. The average credit score in the United States is around 680. If you are below this number, you are below average and may have some work to do. If you’re above a 680 credit score, you’re probably wasting your time reading about the different ways to improve and build-up your credit history.
If instead, you'd only like to view your credit report to check for errors, you may access your three credit reports once a year for free at www.AnnualCreditReport.com. While you can't see your credit scores for free, this website will give you access to an updated copy of your credit reports.
Check Your Credit for Inaccuracies & Other Negative Reporting Items
Once you have a fresh copy of your credit report, the first thing you'll need to do is check for inaccuracies and negative items. When examining your report, make sure you check every section carefully. Even a misspelling of your name or a wrong address can affect you.
The most common things to look for include;
Accuracy of your name, previous addresses and employment history
Late payments and charged-off accounts
Collection accounts, judgements and tax liens
Number of hard and soft inquiries
The status of accounts. (i.e.. are your closed accounts noted as closed)
If you find anything that needs to be removed or corrected, your next step is to dispute those items with both the original creditor and the 3 credit reporting agencies. Below we've included a step-by-step guide on how to complete this process.
How to Dispute Items On Your Credit Report
Once you've identified the problem areas on your credit report, disputing those items is easy. The easiest and quickest way to dispute any item, is to electronically file the dispute online through each credit reporting agency. Below are a few links to the credit reporting agencies where you can dispute things online.
TransUnion = www.transunion.com/personal-credit/credit-disputes
Equifax = www.ai.equifax.com/CreditInvestigation
Experian = www.experian.com/disputes
If you are not very computer savvy, you may also mail a formal dispute letter to the three major credit agencies TransUnion, Equifax and Experian using the following addresses.
If you need guidance on how to write or prepare a formal dispute letter, we've provided a link below that will allow you to download for free a few templates. These templates are made to be a guide, and should be altered to match your specific situation.
Free Credit Report Dispute Letters | Click Here to Download
Once you've completed your dispute letter(s), you'll need to send each letter with a copy of your credit report to each credit agency. This means if you are going to dispute 1 item, you'll need to print 3 letters and 3 credit reports, that's 1 letter and 1 credit report for each of the 3 credit agencies. It is best to highlight on your credit report exactly which item needs to be removed. When sending your letters, be sure to mail them via "certified mail" so can keep track of when the credit agencies received your dispute letter.
What Happens After Something Has Been Disputed
After you have formally disputed an item on your credit report, the credit agency will contact the creditor. The creditor then has up to 30-days to report back to the credit reporting agency. If the creditor fails to reply within the 30-day window, the credit reporting agency is required by law to remove the item off your credit report. If the creditor confirms the disputed account is an error, and therefore needs to be fixed, the credit agency will comply. If the creditor confirms that the account is indeed being reported accurately, the credit reporting agency will notify you, and nothing will be changed on your credit report.
Hiring a Professional Credit Repair Company
If you are feeling confused or intimidated about the process of doing things on your own, you may want to consider hiring a reputable credit repair company. It some cases, it may make sense to retain a professional to take care of things for you. Professional credit repair companies know their way around, and also how to effectively communicate with each credit bureau. They can also save you a bunch of time.
Ways to Add Positive Reporting Items to Your Credit Report
When trying to improve your credit scores, it's important you make all your payments on time. Your pay history is a major part of how your credit score is determined. Missing even one payment can drastically lower your scores. In addition to paying your bills on time, you'll need to also build-up the amount of positive accounts you currently have reporting to your credit. This is especially important for young people, and people just out of bankruptcy. Below we have listed a few ways to acquire new positive reporting accounts. These options are good for all individuals, including those with bad credit, and those who have been turned down for conventional financing in the past.
Get Your Rental Payments Reported: Many renters don't realize that rent payments can be reported to your credit history just like a credit card. While most apartment complexes don't automatically do this, there are companies out there that can help you in getting your rental payments reported. These on time rental payments will show creditors that you can successfully pay your bills on time.
Get Your Rental Payments Reported | Learn More Here
Get a Credit Card: Once of the easiest type of accounts to obtain, even if you have no credit, bad credit or a bankruptcy, is a credit card. There are credit cards that are specifically designed for people with new, bad and no credit. While the credit limit on these types of credit cards is not high, typically around $500, using a credit card wisely, can show future creditors you are a good risk and are able to pay your bills on time.
Credit Cards For All Credit Types | Click Here to Apply
Consolidate Debt and Improve Your Credit Score
A big part of your credit score is something called your credit utilization. This is the amount of credit available to you, versus the amount of credit you are actually using. Ideally you want to be below 30%. This is especially important if you are interested in making a big purchase such as buying a home.
Using an unsecured debt consolidation loan to consolidate your credit cards can help improve your credit utilization. When you pay off your credit cards with a consolidation loan, you won’t eliminate your debt, but you will make it look more attractive.
Generally speaking, closing your credit cards is a bad decision when it comes to your credit score. To reach the highest score possible, you'll want to have a few accounts reporting to your credit history for several years. If you close your accounts, they will no longer report to your credit. This will shorten what is called your" length of credit history."
Working With a Life House Financial
Life House Financial is dedicated to helping you in any way we can. If you have questions, we are here to help. Life House Financial does not offer credit repair services, therefore you don't have to worry about being pressured or sold into any type of program. We'd be be more than happy to answer any questions you may have about the process of fixing and improving your credit for free.
Don't want to speak with us over the phone? No problem! You can learn more about credit scores, and the impact it can have on your life in our Education Center.