DIY Credit Repair
Credit scores sometimes feel like the GPAs of high school. It’s just a number but also has a lot of power of what you can be approved for (like GPAs determine what colleges you can get into). If you’ve struggled with credit, it may be tempting to call the 800 number you hear on the radio promising you an overnight solution to repair your credit. As tempting as it is, do not do it! Most of these are just scams that will get you to spend money you don’t need to.
You can work on repairing your credit yourself and you should.
Step #1 – Monitor your credit
The first step is seeing where you are at. You can get copies of your full credit reports from all the credit bureaus (Experian, TransUnion, and Equifax) by going to annualcreditreport.com or calling 877-322-8228. You are able to get your reports for free once a year via Annual Credit Report.
You can also sign up for a reputable credit monitoring service. These services help you by sending alerts anytime there is suspicious activity on your credit and also giving you the ability to check in often. You can find a list of some options here.
Step #2 – Dispute any errors
Once you have your reports, you should review them for accuracy. Confirm that your name, address, social security number, and all other personal information is correct. Then review all the accounts reported including balances. If you see any errors, you can tell the credit bureaus in writing what information you think is incorrect. Make sure to include copies of supporting documents (bank statements, credit card statements, etc). You can find a sample letter for disputing errors on your credit report from the Federal Trade Commission here.
According to the Federal Trade Commission, credit reporting companies must investigate the items you question within 30 days unless they consider your dispute frivolous. Once the investigation is complete, the credit reporting company must also give you the results in writing and give you another free copy of the report.
Step #3 – Control the things you can control
While sometimes there can be errors on your credit report that negatively affect you, a lot of the time your scores can be in your control. If you have a poor credit score because of things like missing payments, maxing out accounts, or applying for too much credit in a short period of time, work on improving these behaviors:
- Always try to pay your bills on time even if it’s just the minimum payments.
- Work on paying off your debt, especially high interest credit card debt.
- Avoid applying for new credit. If you are trying to get a handle on your credit, one of the best things you can do is break the cycle of continuing to apply for new credit.
For more information, or if you have any questions, please reach out to your trusted wealth advisor at Warren Street Wealth Advisors.
Director of Operations, Warren Street Wealth Advisors
Investment Advisor Representative, Warren Street Wealth Advisors, LLC., a Registered Investment Advisor
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