One question that people frequently ask when working to pay off debt and rebuild their credit is “Should I hire a credit repair company to get the job done faster?”
I have seen plenty of ads on TV and websites on the Internet that promise to repair your credit quickly. Is it possible to pay a few fees and repair your credit just like that? Unfortunately, if it were that easy, more people would have much higher credit scores.
The fact of the matter is, YOU can repair your credit yourself without hiring a company to do it for you. Don’t fall into the trap that someone else can do it faster, because that simply isn’t the case. There’s no quick way to repair your credit – it takes time and work, but if you put forth the effort, you’ll see results in the end.
So what can you do to rebuild your credit?
Get a copy of your credit report from www.annualcreditreport.com, the only official site for checking your credit report for free. Every year you can view one copy of your report from each of the credit reporting bureaus for free. Check it for inaccurate information, and report any false information to the bureaus. Unfortunately, only false information can be deleted, not negative notes.
Keep paying off your debt on time every month. It’s always the best idea to pay your credit card debt in full, but even if you can’t pay the whole amount, do not skip payments. A big part of your credit score is having a history of on-time payments.
Likewise, don’t use you credit cards to their limit. A higher debt-to-credit ratio (using a higher percentage of the credit that’s available to you) can lead to a lower credit score. Paying off your balance in full every month not only creates a history of on-time payments, it also increases the amount of available credit.
If you have a collection account on your credit report, paying the balance off won’t remove it from your report. If you pay what you owe, make sure they agree in writing to notify the credit report that the balance was paid in full. It’ll still be on your credit report, but at least it will show up as paid in full.
Avoid opening new accounts to increase your credit limit. When you apply for credit, the issuing company will check your credit report, and those inquiries can cause your score to drop a few points. Applying for multiple cards in a short period of time will hurt you much more than it will help. Try to focus on improving the accounts you already have open.
On that line, avoid closing accounts too. The length of your credit history plays a role in your score, so the longer your credit history the better. Closing your oldest accounts, even if you don’t use them anymore, will shorten the average length of time your accounts have been open. This can hurt your score as well, so leave those old accounts open even if you don’t use them.
Remember, you don’t need to pay expensive fees to a company to repair your credit quickly. There simply is no way to do it quickly. As with most things in life, if you put in the time and work hard, you’ll see results with a better credit score in the long run.