Credit Education 101
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DIY Credit Repair

By Janet Lacey
Published: Monday, October 5th, 2009

Your credit report is an extremely important financial document that determines not just whether you will get credit or not, but also influences your employment prospects and standard of life. Having a poor credit score will make lenders turn down your requests for loans and all kinds of credit while having a good credit score will let you get credit at low interest rates and easy repayment terms.

If your credit score is low (below 500) or you think improving your credit can help you get better credit terms, then you can go for credit repair on your own. Do It Yourself credit repair will save you money that credit repair agencies may charge for cleaning up your credit report.

The steps involved in clearing up your credit report are:

  • Get Your Credit Report And Check It For Discrepancies: If you have been defaulting on your payments, then it will definitely show up in your credit report and there is nothing much that you can do about it. However, in many cases, you may find that your credit report lists a number of negative items that do not actually exist. Getting these discrepancies cleared up can improve your credit score considerably. You can order a free credit report from any of the credit reporting bureaus—Experian, TransUnion or Equifax.
  • Make A List Of Discrepancies: Review your credit report properly and make a note of all the negative items that are not accurate or false. It is not uncommon to find negative information that is not true or wrong information about a dispute that you might have had with your creditors. Your creditors may also have provided wrong information erroneously. These negative inputs may alter your credit score and should be dealt with without fail. Verify information that you are unsure about before reporting it to the credit bureaus.
  • Write To The Credit Bureaus: Write a separate letter about every single input that you are disputing and send it to the credit bureau requesting for a receipt. Sending this by certified mail will be costly, especially if you are reporting a number of errors, but this may be better because you can get a return receipt (on request) as proof of each dispute being reported.
  • Recheck and Follow Up: The credit bureau has 30 days to investigate the dispute and correct the error reported. After that, it will send you a free correct credit report for your perusal. By requesting a receipt, you get proof of reporting an error on a certain date. This will help you in following up with the credit bureau and ensuring that the error is corrected.
  • Build Good Credit: In case you find that a negative entry is actually right, then take steps to correct it as soon as possible by making your payments or dealing directly with the creditor reporting it. Rebuild your credit by making all payments on time and decreasing your debt to credit limit ratio.

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