What You Should Know about Credit Repair

A Credit Article Contributed by Joyce James

What is Credit Repair?

Credit repair is how you go about fixing bad credit. If you've ever been denied credit, or your applications for insurance have been rejected, or you are not hired for that job you've coveted, then you've got bad credit. As a consumer and citizen it is important that you know how credit agencies are rating you and that you maintain a good credit rating.

Seeking credit repair advice may seem like a daunting task -- something like climbing Mount Olympus and paying big bucks for the pleasure -- but it needn't be so frightening. There are a lot of things that you can do all by yourself to start repairing your credit.

Who Can Repair Your Credit?

If you do a quick Internet search, or flick through the newspapers or your mail you'll find many companies that promise to perform that miracle task and repair your credit rating. But remember this: No one can permanently and legally remove your debt apart from the credit bureau and the creditor.

Credit-repair clinics, if they go about their business legally, can do three things that you can do yourself:

1. They can obtain your credit files from the credit-reporting agencies.

2. They can look over and mark all inaccurate and negative information.

3. They can ensure that this inaccurate and negative information is cleared from your record.

The thing is, you can do all of this yourself for free or for next to no cost at all.

How to Start Repairing Your Credit

Fixing bad credit is not always easy. There is no credit fairy who can magically clean your record. The process of repairing your credit worthiness takes time, so be patient. Just take one step at a time.

There are basically two big steps you need to take:

1. First up you need to find out what exactly is on your credit record. If you've recently (within last 60 days) been denied credit, insurance or employment you can obtain a copy of your credit record from one of the major credit checking agencies (Equifax, Experian or TransUnion Corp) for free. Otherwise you'll pay around $10. Once you discover what's on your credit report you can request a reinvestigation of the information. That's free, too. Whatever information is incorrect will be removed from your record.

2. Now you need to start paying your debts. Here you need to think smart and get creative. Talk with your creditors to organize a plan for repayment. Also, seek out credit repair counseling to help you succeed with your personal debt repayment plan.

What If I Still Want to Speak to a Credit Repair Company?

If you still want to consult a credit repair clinic then do your homework and look for warning signs. Steer clear of those who ask you to pay up front and don't offer a signed and dated written contract. Companies that don't tell you what you can do yourself for free or those that don't talk to you about your rights are best avoided.