Credit History Repair

Consider yourself fortunate if you never have to take steps to repair your credit history. However, the reality is that many, many people will have to take some sort of action in their lives to repair their credit history. In the event that you are one of those people, there are a number of ways to attempt to repair your credit history.

First you may wish to determine whether you need to repair your credit history. Quite simply, if you intend to borrow money for a car, a house or even if you just want to get a new credit card with a higher credit limit any time in the next seven years, it is a good idea to do all that you can to repair your credit history.

You will need to obtain a copy of your credit report from one of the three credit bureaus that maintains records of your credit history, including whether you have ever had a collection agency called on you, a bankruptcy, or a foreclosure. You can receive a free credit report if you have been denied credit by a lending institution within the past 60 days, or are unemployed and can prove that you intend to secure a job within the next 60 days, or have been evicted from your place of residence. Otherwise a credit report costs nine dollars.

Once you have obtained your credit report you should carefully examine it to ensure that there are no billing errors, questionable charges or fraudulent charges. Occasionally, a purchase can be charged twice to you and your credit card company will be happy to fix the error.

And in this day of internet piracy, it is not unheard of to have your personal card information stolen, and subsequently used to make illegal purchases. It's important that you guard your credit card number and information to ensure this doesn't happen, but if you find yourself the target of credit card fraud, it is usually a simple matter to demonstrate to your credit card company that you have been victimized. In fact, some companies will monitor accounts to ensure that no unusual activity takes place, and if they detect sudden unusual activity, will call the card holder to verify. After all, it is in the company's vested interest to halt all forms of credit card fraud to protect both you and them.

Should you find any billing errors, do everything in your power to make sure the credit bureau removes them from your credit report. When this happens, you will need to supply the credit bureau with the following pieces of information: the company name of the disputed item, the account number of the disputed item, and the reason why you feel this item is in error. The credit bureau will then review your case and investigate if necessary. They are then required by law to remove any credit report errors they find. As well, if any companies have obtained copies of your credit report with in the last 60 days the credit bureau must inform those companies of the changes to your report.

If, however, you have reviewed your credit report and have found that there are no errors or questionable charges, you may now have to face up to negative credit. You still have some steps available to improve your credit report.

You are entitled by law to dispute any negative item on your credit report, and the credit bureau must verify within thirty days whether the negative item is true or not. While they are investigating, you do not have to pay the disputed amount. If they are unable to verify, they must remove that item from your credit report, and provide a written explanation of the findings for your credit report. If, however, they find the disputed item to be valid, you must then negotiate with your creditor and any collection agencies involved and agree upon a payment plan.

It is important that you then follow the terms of the agreed-upon payment, as doing so will help restore your positive credit, and failure to do so will of course reinforce your negative credit. Negative credit reports that are proven to be valid then become part of your credit history for seven years, and ten years for a bankruptcy. You may find that obtaining a line of credit during this time will be more difficult. However, it is not impossible, as you may be able to take out a secured line of credit if you have sufficient collateral. In doing so, make sure you pay your bills when they come due- this will help to improve your credit report, as well as prevent the creditor from foreclosing on your collateral.

The best way to repair credit is to deal personally with your financial institutions, including the credit bureau or bureaus, and to work with them to come up with a plan to pay off your debts in a timely, yet fair, manner.