Credit Fix Facts

Developing and maintaining a solid credit history is important if you want to get credit for various life needs, like buying a home, car or even getting insurance. When your credit history shows problems, it is important to take steps to fix them as soon as possible.

Errors on Reports

A significant number of credit reports have errors, according to the U.S. Public Research Interest Group. A 2004 study found that 80 percent have errors and a quarter have errors so serious that it could affect someone's ability to get credit. A credit report error could range from a wrong address to a creditor reporting incorrect information.

Fraud Alerts

In some cases fraud may occur in which an unauthorized party opens an account in the consumer's name, and that information is reported to credit bureaus. In this case the consumer must contact the creditor to identify and fix the fraud report. The consumer can call the credit agencies to place a fraud alert on his report to prevent the issue from occurring again. The fraud alert lasts for 90 days at first; then the consumer can extend it for up to seven years.

Scams

Consumers must beware of credit repair scams. Some companies promise a quick fix to credit issues and a boost to credit scores. Some scammers promise to remove negative information from credit files right away. But according to Gail Hillebrand, an attorney for the nonprofit Consumers Union, "Anyone who promises to get accurate information less than seven years old off a file is lying." Other companies falsely promise to provide the consumer with a brand new credit file, but that is also a lie.

Suggestions

The only way to fix a credit report is through information gathering, disputing errors to credit bureaus, and changing credit or debt management habits. The consumer must maintain accurate records for his financial accounts and access his credit report regularly to identify and then solve problems. To fix bad credit, the consumer must pay off his debts and submit on-time payments going forward.