Your credit score is one of the most important tools for your financial life. Whether or not you qualify for loans, credit cards and even simpler things such as renting an apartment depends almost completely on your credit score. If you have a bad credit score, you can begin to fix this by receiving credit repair counseling, which helps you to manage your credit and change the information on your credit reports.
Is Credit Repair Legal?
Credit repair is a legal tool to change information on your credit reports. Some federal laws help you to be sure that you have the right and that you can repair your credit. The Fair Credit Reporting Act was passed in 2003 and gives you the right to receive an accurate credit report. It also allows you to dispute any inaccurate information with the credit bureaus. The Credit Repair Organizations Act helps to ensure that credit repair agencies do not take advantage of consumers. However, things you do that change your vital information, such as creating another identity, are not legal.
What Are the Credit Reporting Agencies?
Credit reporting agencies are in charge of compiling your financial information into credit reports. This information is compiled by the reports that these agencies receive from your creditors. The three main credit reporting agencies are Equifax, Experian and TransUnion. All three of these agencies are important because each one reflects at least a third of your credit information. You may find information that is not available through one of these companies if you look at the other company's credit report.
For How Long Can My Credit Score Be Negative?
Your credit score is negative depending on how you manage your debts. If you have many debts but you also pay them adequately, you probably have a good credit score. However, if you have problems making timely payments, these problems will influence your credit score in a negative manner. Most negative information stays on your credit report and affects your credit score for seven years. Filing for bankruptcy can stay on your credit score for up to 10 years.
How Does Credit Repair Work?
Credit repair is done based on the Fair Credit Report Act, which gives you the right to dispute credit report information. Companies that offer credit repair services dispute negative information on your credit report with the courthouse, credit reporting agencies and creditors or lenders for you. They dispute any negative information that cannot be verified, and these are then removed from your credit report. A new credit report is issued with the corrected information, and this is reflected in your credit score.
Can I Do Credit Repair On My Own?
You can do credit repair on your own, especially if you do not have the money to pay a credit repair agency to do it for you. Send credit dispute letters to your creditors, lenders or credit reporting agencies, or you can send a pay for delete letter to your creditor, which is an agreement with your creditor in which you pay off all the remaining debts and he removes the negative listing from your credit report.
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