How To Improve Your Credit Score

There are a few steps you can take to improve your credit score. Contrary to popular belief you don't just have to live with bad credit.


In fact Congress passed the Fair Credit Reporting Act (FCRA), this law gives you the right to challenge items on your credit report. It was passed with good reason to, as it is estimated one in every four reports contains an error.


1. Get Your Reports - the first thing you must do is get an up to date copy of your reports. You need to get your report from each bureau, as they will probably vary a little and you need to know what items to challenge. You can get a copy of your reports for free by visiting Annual Credit Report - you can only get one copy for free per year.


2. Negative Marks - these are: collections, charge offs, judgements, bankruptcy, defaulted student loans, repossessions. These negative marks are what is ruining your score. You are entitled by the FCRA to dispute any item you feel is inaccurate.


An item can be inaccurate because it has the wrong dates, the wrong balance, you don't recognize the account, it is in error ... This gives you the legal right to file a dispute to have this item investigated.


3. Credit Dispute - file this with each bureau. They will investigate the item and contact the lender. If they lender can not verify the account then it will be removed from your credit report.


4. Settle Delinquent Debt - if you are being contacted by debt collectors you are going to need to settle these accounts. But before you just go start paying off old bills you need to do something. You need to request debt validation from these debt collectors.


This requires them to show that they legally own your debt. It is shocking how often they can not provide this information. If this occurs then you do not have to pay and the item on your report will be removed if you dispute it.


If they validate the debt then you need to negotiate that in exchange for your payment they will stop reporting the item to the bureaus. That way after you make payment you can dispute it and the debt collector will not verify the account with the bureaus as per your settlement. Thus, it will be removed from your report.


5. Learn The Lesson - listen things happen, life has a way of throwing us one thing after another and especially when we can least afford it. Don't be embarrassed by having bad credit - it says nothing about you. And there are individuals of every income level that have bad credit - I promise.


Further, there are countless individuals that are some of America's greatest figures that had terrible credit. They had gone through bankruptcy and many years of financial difficulty. So don't feel bad just take action to fix it.


6. Show Available Credit - when you have your score checked they will look at the amount of debt you have compared to the amount of available credit you have. Availiable credit is unused funds, for example the money between the balance and your limit on your credit card. If your balance was $200 and your limit is $800, then you would have $600 of unused or available credit. Having availiable credit will help your score tremendously.


How Do I File a Credit Dispute


You must file a dispute letter. In this letter you must include your personal information and the item you are challenging. You also need to provide the reason for the dispute and any evidence you have supporting it.


The hard part and the reason you hear people say you have to just live with bad credit is because before the bureaus will investigate the dispute they have to deem it valid. In other words, the bureaus spend money when they investigte disputes and therefore want to avoid doing it.


The only reason the bureaus do investigations is to comply with the FCRA. However they have discovered it is better economically to develop a process that requires a determined and credit wise consumer to get their dispute investigated.


If you do get frustrated with trying to work with the bureaus - don't give up! You can have good credit and you can improve your credit score. Consider hiring a professional credit repair service.


They can help with the dispute process and bring the power of a lawyer to ensure that your dispute will be investigated. Additionally they can help you seek debt validation from your delinquent debts. For a free credit consultation call 1-800-483-0256 and take the first step to a 700 score.