If you're struggling to improve your credit, you're not alone. Whether you were a victim of identify theft or simply got behind on your bills, your journey to improve your credit is a common one. Fortunately, you can repair your credit in a number of ways. Take advantage of available resources, many established by the Federal Trade Commission, to stay informed of your credit score and to dispute any fraudulent charges connected to your name.
Access Your Credit Report
The Fair Credit Reporting Act states that you can receive a free copy of your credit report from the three credit-reporting agencies -- Equifax, Experian and TransUnion -- once a year. Take advantage of this act, and order your credit report annually. This can help you quickly identify any problems on your report. If a company takes "adverse action" against you, such as denying a credit application, you can also receive a free copy of your report. Being an informed consumer can help you repair your credit, so always know your credit score.
Dispute Fraudulent Charges
Bad credit can often be the result of identity theft or simple miscommunication between you and a creditor. If you discover inaccuracies on your credit report, dispute them. The FTC recommends that you send a formal letter to the credit-reporting agency that outlines the specific items you are disputing with facts that support your argument. Attach a copy of your credit report with the disputed items highlighted. Once the agency eliminates the disputed items from your report, your credit rating will improve.
Get Back on Track
It takes time to recover from a negative credit rating, but you can speed up this process by getting back on track. Pay your bills on time, and reach out to creditors to work out debt consolidation plans to reduce the amount you owe. While a record of on-time payments cannot eliminate any negative items on your credit report, a record of current, on-time payments will impress anyone viewing your credit report. After seven to 10 years, the credit reporting agency will remove negative items such as bankruptcy from your report, thereby boosting your credit.
Avoid Credit Repair Scams
Unfortunately, some people take advantage of those suffering from credit problems, so it is important that you avoid credit repair scams. The FTC describes several ways you can identify a scam. If the company charges you an upfront fee or doesn't tell you your rights, it could be a scam. Moreover, any company that tells you not to contact any of the three credit reporting agencies might be out to take your money and not to help repair your credit.
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