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When Do You Need Credit Repair?

by | Aug 5, 2022 | Credit

When Do You Need Credit Repair

Bad credit can wreak havoc on many aspects of your life. But did you know that some studies have found that one in three people discovered at least one error on their credit reports?

If you have never checked your credit score before, or if it has been a while, you can click here to get a credit check through our partners now.

As every consumer is entitled to an accurate, fair, and fully substantiated credit report under the Fair Credit Reporting Act, there are steps that you can take that may repair your credit score. We will address how to determine if credit repair is right for you and how you may even be able to do so yourself. (Also, if you know you need to spruce up your credit, you can get started on that as well– click here for industry-leading credit repair.)


What Exactly is Credit Repair?


Put simply, credit repair is any means by which a consumer seeks to improve their credit score. The more you can increase that number, the more opportunities you will have financially, especially when it comes to borrowing money. But before we cover some of the steps on the how-to, let’s dig a little deeper into finding out if doing so is right for you.


Signs That Your Credit May Need Repair


Credit Card Denial

With poor credit, you are much more likely to be denied when applying for new lending opportunities. Credit card companies denying your application could be a sign that your credit score is in need of repair. Thankfully, these companies are required to send you an adverse action notice, which lets you know the reasons that your application was denied. If this was due to information contained within your credit report, you are entitled to a free copy of the report.


Utilities in Somebody Else’s Name

Utility companies, such as those that provide electricity, use a credit check to see whether or not they are willing to provide services to you. If you are having trouble establishing these types of services in your own name, then you likely need to increase your credit score.


Unable to Rent Property

Similar to utility companies, landlords run credit checks to determine who they will sign a contract with. If you have poor credit, especially in situations such as larger apartment complexes, the landlord may likely reject your application out of hand.


Calls From Debt Collectors

When creditors determine that you will not pay the bill for an account, they often send this debt to a collection agency. These agencies will then relentlessly attempt to collect what is owed. Meanwhile, these accounts appear on your credit report and can greatly impact your ability to get approved for additional financial opportunities. Credit repair can help either dispute these claims if they are mistaken, or advise you on how to pay off the debt in the most beneficial way possible.


Lost Job Opportunities

Believe it or not, many employers use credit scores to determine whether to hire new employees or even whether to promote existing ones. This can especially be the case for positions that hold executive or financial responsibilities. Not all employers run credit checks as a part of the hiring process, but repairing your credit might open doors that would otherwise remain closed to you.


Climbing Interest Rates

Unfortunately, a low credit score usually means poor terms on loans. Credit card companies often raise interest rates when you are late on payments to other lenders or when a new collection account appears on your report. Services that repair your credit will dispute false information on your report and can hopefully help you to improve your interest rates.


Identity Theft Victim

In the aftermath of identity theft, you are usually left to deal with more than just the violation of privacy. The credit bureaus cannot be bothered to scrub all of the false impacts upon your credit score. That task, unfortunately, will fall onto you to handle. You will likely have to file disputes and prove the identity fraud for each and every item that should not be on your credit report. This is certainly one place where hiring a credit repair company could be in your best interest.


Researching Your Credit Score


The first step to take in repairing your credit is to discover what your current score is and what might be lowering it. A credit score below 740 is considered less than ideal nowadays. If your score has slipped below 650, then you should consider credit repair. If you are unaware of where your credit score currently stands, you should check it now. You are legally entitled to obtain a credit report every year, for free, from each of the major credit bureaus.


Understanding what factors are used to calculate consumer credit scores, and what can lower your score, can be vital. Some of the major factors that can bring down your credit score are:

  • A History of Late Payments: How often you pay bills on time can carry a lot of weight with your credit score. Even one payment that is overdue by 30 days can be harmful to your score. Other factors could be a history of payment collections, bankruptcies, or foreclosures. Repaying outstanding bills should be Priority #1.
  • Excessive Credit Utilization: How high your account balances are when compared to your credit limits might concern potential financial providers. They may come to the conclusion that you might owe too much money already in order to take on any new debt. Anything above 30% of your balance is considered high, with a rate of 10% or less preferred.
  • A Short Credit History: How new your credit accounts are could lead lenders to see your ability to manage your credit as unproven. When possible, try to keep your accounts of credit open for 7 years or longer.
  • Credit Mix: If you have only ever handled one form of debt, such as a credit card or a student loan, financial providers may not feel confident in you being able to juggle other types of debt. A good way to improve your score is to prove that you can manage different types of credit, such as auto or mortgage loans.
  • Too Many Credit Inquiries: How often you apply for credit can even impact your score. If you apply for many different loans or credit cards in a short period of time, it might cause potential lenders to view you as being high risk. These kinds of inquiries stay in your file for 2 years.


Credit Repair: Do-It-Yourself or Services for Hire


It is absolutely within your rights to repair your credit. The process for disputing your report with each of the credit bureaus on your own is completely free. However, many people find that they either do not have the time or that they don’t understand how to make their case. Hiring a credit repair professional may be your preferred method in handling this disputation process. They have been through the motions before and likely know what to look for and how better to file any potential disputes.


Most services charge a monthly fee while fixing your credit, but some may also require an additional setup fee. Make certain to research any company you are thinking of hiring, as there are scammers in this industry. Only work with a legitimate credit repair company, and avoid anyone who says that they can remove verified and accurate information from your credit report.

If you are thinking about hiring such a service, click here to check out the latest credit repair offers from our affiliate.

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