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All you need to know about Credit Repair

By Janet Lacey
Published: Tuesday, October 27th, 2009

This is an article that tells you all that you need to know about credit repair. The most basic term in finance today is Credit. Have you ever had a loan or a credit card? This is a credit. Any mortgage or student loan you might have had is also a credit. Credit is when you use a creditor’s funds to buy some kind of goods or services. You are borrowing his money to pay for your product. You are also making a guarantee or a promise to repay the money the loan in a timely manner in the form of instalments. At any point of your life, whenever you want to make an investment or buy some thing, you are taking credit. It is natural for the creditor to take an interest in your financial background. He will want to know hat kind of a person you are financially. The place to get such information is your credit report.

A credit report is an account of all your financial history. It shows every credit you have had and how have you been in repaying them. It shows if you have been efficient with your finances and repaid loans promptly or not. Based on this information, the creditor attempts to gauge whether you are eligible for the new credit or not. If you are, the credit report decides your interest rates. If you have a great credit report, you get the best rates. Thus maintain a great credit report and history is of paramount importance.

However, you will have some problems in the credit report. These will affect your future adversely. Thus, you should be able to remove these negative entries. This process, of removing negative entries through bureaucratic investigations is known as credit repair. Credit repair happens when a person with a bad credit history takes some responsibility and tries to get his credit score and history into shape. One of the most basic steps of credit repair is keeping you updated. There are three main agencies in the United States that produce credit reports. These are Equifax, Experian and TransUnion. There is a new federal law that states that every citizen should get a free report from each of these three agencies per year. Get these reports and keep a close tab on your reports. If you see an entry you do not concur with or you feel is not right, immediately raise a dispute. Write to the agency and they will conduct a through investigation on your behalf. They will have to be prompt and ensure it starts soon. If the investigation is not completed within the stipulated, the law says the agency should strike the entry off your record and send you a free corrected copy of the credit report.

Credit report needs constant monitoring and is a lot of hard work. However, this is an exercise that is of utmost importance as all your future credits and investments will be a lot easier and better with a good credit history. A person with a bad credit history can repair his credit and get a better score in a matter of a couple of years.

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