Having negative remarks on the credit report can be costly while obtaining a loan and give the lender an impression that you are a higher risk to the bank. Well, don’t feel this is the end of the world though. There’s always a way to rebuild your credit. However, credit repair do not just happen overnight. It requires some knowledge and serious commitment on your end.
Credit Repair Process:
1.) Request 3 reports
First of all, you need to order your credit report from 3 credit bureaus; they are Equifax, TransUnion and Experian. Because not all your creditors report to all 3 bureaus, each report from each bureau is somewhat different from one another. Every year you are entitled to a free copy of your credit report from each bureau.
Once you receive your report, inspect each item on the report carefully. Since the credit bureaus generate the report based on the info they collect from your creditors, these info is never verified. It is your job to keep your report a good indication of your credit worthiness.
2.) Look for errors
Pay attention to the typing errors, incomplete info, outdated or any inaccurate account history. Make sure you list all the errors, just so you can dispute credit report.
3.) Dispute your credit report
Since bad credit costs money, you definitely want to write a dispute letter along with the supporting document and send those to the credit bureau to have these negative remarks removed. Do remember to keep copies of all documents before sending out. More often than not, the bureau will investigate the dispute within 30 days after receiving your letter. Any item proved to be inaccurate will be removed from your report.
Two Additional Ways to Rebuild Credit:
1.) Ask your creditor to report to credit bureaus
Besides doing the credit repair on your own, another way to improve your score is to add positive information on your credit file. Even you have the credit, there can be a time when you get denied due to insufficient accounts. One thing you may not notice is that not all of your creditors report your credit history to the credit bureaus. What you can do is to ask your creditor to report the information of your account and the monthly payment history to the 3 credit reporting agencies.
2.) Use credit cards for rebuilding credit
You can also try to rebuild your credit by using secured credit cards. These types of cards are offered to those with no credit, bad credit or in the process of repairing their credits. To get you accepted faster, it is a good idea to open a savings account in the bank you are applying for the credit card. By doing so, it shows your creditors that you are trying to save money, be responsible and you are reserving money to pay off debts.
Credit repair is a work that requires you to be patient and committed. It may take some time to see the result, but if you don’t give up, sooner or later, you will see some decent credit scores climbing up in your report.