Table of Contents
- Details About Best Credit Repair Companies
- The Case for and Against Using a Credit Repair Service
- Comb Your Credit Report for Errors
- Pay Off Your Debts
- Build a Positive Payment History
- Keep an Eye on Your Credit Utilization Ratio
- Explore Your Options for Fast Credit Repair
Did you know 53 percent of all Americans have had their credit applications turned down? Reason: bad or poor credit.
If your credit score is 670 or lower, you’ve got bad credit. Anything below 579 is poor.
Details About Best Credit Repair Companies
In this economy, fewer things are worse than having bad credit. Besides your credit applications being turned down, landlords can also cite your credit that makes money as a reason to reject your application for best credit repair companies.
This is probably why you looking for a fast credit repair service. But do these services work as advertised? What are your options for quick credit repair? We’ve got all the information you need. Just keep reading to know about best credit repair companies.
The Case for and Against Using a Credit Repair Service
First things first, it’s true that there are legitimate credit repair services that will help you improve your credit within a relatively short period of time. Such companies have credit repair experts who will assess your best credit repair companies and devise suitable credit rebuilding strategies.
However, there are also lots of illegitimate best credit repair companies. They will ask you to pay a service charge upfront and fail to live up to their promise of fast credit repair.
Legitimate Credit Repair Companies
Most of these companies are riding on your desperation, knowing that you probably want to secure a loan or get a credit card as soon as possible. US Allied Financial Credit Repair has an informative article on common best credit repair companies.
To find a legit company, ask around for recommendations and do extensive online research. Find out whether a company you’re looking to hire has plenty of customer service reviews backing their claims. If a credit repair company is fraudulent, you’ll certainly find reviews posted by frustrated clients.
Now, here is the most important thing. While a legit credit repair service will help boost your credit, it largely comes down to the nature of your credit.
If you’ve got a foreclosure or bankruptcy on your report, for instance, there’s only so much a credit repair company can do to boost your credit. This is why you need to evaluate your credit situation before hiring the best credit repair companies.
Most of the time, you can do on your own the same things a credit repair company will do. Follow these strategies:
Comb Your Credit Report for Errors
A recent survey established that one in five Americans have errors in their credit reports. These errors can have a big impact on your current credit score.
For instance, if you find that the name on your credit report isn’t yours (maybe you’re John J. Doe and the name on the report is Jon J. Doe), there’s a good chance you’ve got someone’s credit on your report.
Other common errors include inaccurate account balances, closed accounts still marked open, inaccurate payment dates, and duplicate accounts.
Fast Credit Repair Services
If you find an error or detail you don’t recognize on your credit report, file a dispute with the credit bureau that issued your report. If the error is indeed an error, the bureau will correct the issue and your credit score might see a small jump.
Depending on your current credit score, a small jump can make a difference between having bad and good credit. For example, if your score is 675 (bad credit), a 10-point jump will take you to 685, which is good credit. And with good credit, you can now qualify for loans.
Pay Off Your Debts
A primary reason many people end up with bad credit is defaulting on their loans. The loan then goes into collections. A collection account will stay on your credit report for seven years best credit repair companies.
Credit Repair Specialist
Within this period, any lender who accesses your credit report will see that you’ve defaulted on a loan before. Good luck getting a loan from that lender!
As such, when you want to rebuild your credit quickly, one of the first things you should do is pay off debts in default. Yes, the record will stay on your report for seven years, but paying off the debt will give your score a boost.
Build a Positive Payment History
Your credit payment history has a 35 percent impact on your credit.
If you’re always paying your loans and settling credit card balances on time, rest assured your credit score will rise quickly in best credit repair companies.
The challenge is: how do you build a positive payment history after ruining your credit? You’ve probably let a loan or two go into default and your credit card applications are getting rejected. This means you have no means to start building a solid payment history.
Reputable and Fast Credit Repair Companies
This is where credit builder loans and secured credit cards come in handy.
A credit builder loan is designed for people who’re looking to build their credit. Requirements vary from lender to lender, but most will ask you to put down a deposit, which will also serve as your loan or credit card limit.
As you start making payments, you’ll start to rebuild your payment history.
Keep an Eye on Your Credit Utilization Ratio
Let’s say you have a credit card with a $1,000 limit.
If you spend $900 this month, your credit utilization rate is 90 percent. In other words, credit utilization is the amount of money you use against best credit repair companies.
Having a high utilization rate (over 30 percent) harms best credit repair companies. When you’re looking to build credit fast, aim at spending no more than 30 percent of your credit limit.
Credit scoring models want to see a consistent effort, especially when you’re rebuilding credit. Keep building a positive payment history and maintain a low credit utilization rate over several months. But if your efforts are erratic, you’ll only be shooting your credit repair efforts in the arm.
Explore Your Options for Fast Credit Repair
You’ve got a couple of options for fast credit repair, including hiring the best credit repair companies and taking the DIY approach. While hiring a pro can deliver results, how fast your credit grows will depend on the nature of your credit.
Sometimes taking the matter into your own hands is just as effective. Either way, you now have the information to choose the right lifestyle option for your needs.
Stay hooked to our blog for more credit tips and insights from our Finance section!