Credit repair is a way of improving a person’s credit score. In simple words, it is the procedure of correcting and removing erroneous, bankrupt or incorrect entries on a person’s credit report. Credit repair is a necessary process as it helps one get the desired credit score which is required to avail various loans such as home loans, automobile loans, etc. Credit repair is also helpful for one to maintain a clean credit history for the next few years. The importance of credit repair cannot be ignored by anyone, especially banks and lending institutions.
A person can hire a company or a lawyer to carry out credit repair activities on his behalf. If you want to do it yourself, you will require certain tools to get started. A credit repair kit comprises of several manuals and checklists that are designed to fix various problems relating to bad credit reports, credit scores, etc Credit repair. One of the main things that you should have before carrying out credit repair activities is a copy of your credit report from the credit bureau.
You will also require an agency letterhead and a letter from the company that you have hired for the repair activities. The Fair Credit Reporting Act allows you to dispute anything that is inaccurate and incomplete in your report. It is important to note that this act will not become effective if the dispute is not raised within the thirty days prescribed by the Fair Credit Reporting Act. There are certain other aspects that you will have to look into when you wish to dispute inaccurate items in your report.
Credit repair is often required because of a wrong entry in the debtors’ statement. This may occur because of numerous fraudulent acts done by the debtor. If this occurs, the creditor will contact the debtor and request for explanations. The debtor may provide these reasons and correct the debt, but if he does not mention any negative information, then the creditor will consider him to be non-compliant and will send a letter of accusation to this person.
Credit repair is basically helpful to improve a debtor’s credit score and to get a better debt settlement agreement. As a matter of fact, it can also be useful to repair any negative remarks that may be appearing on the debtors’ statement. However, this can only be done with the help of a reliable credit repair agency. The company will help you raise disputes and correct inaccurate information on your report if you have been a victim of fraud.
However, it is important to state that you should only use a repair agency that is registered with the Better Business Bureau (BBB). There are various non-regulated agencies available but it is recommended that you avoid dealing with them. Even though they might promise to help you repair your credit scores, they might also lure you into getting into deeper trouble. These agencies that are not regulated cannot prove their abilities. All they are able to do is take your money and disappear. Hence, always choose a reputed agency and ensure that they are registered with the BBB to avoid getting ripped off.