Credit Repair 101 Basics - How Do I Fix My Credit?

one free credit report annually from each bureau - Equifax, Experian, TransUnion - via AnnualCreditReport.com, as required by the Fair Credit Reporting Act. The temporary weekly free reports program ended in 2023.

1. Visit AnnualCreditReport.com.
2. Provide your name, address, Social Security number, and birthdate.
3. Answer security questions to verify identity.
4. Select reports from one or all bureaus.
5. Review online or download/print.

Scan for errors in personal information, account details, payment history, inquiries, and public records. Note late payments, collections, bankruptcies, or incorrect balances. Highlight disputable items for next steps.

Your credit report lists your full credit history, while your credit score boils it down to a three-digit number.

You receive your credit report from Equifax, Experian, and TransUnion. It includes accounts, payment history, balances, inquiries, and public records. You access free weekly reports at AnnualCreditReport.com. Use it to spot errors and disputes.

Your credit score, like FICO or VantageScore, ranges from 300-850. Lenders calculate it using report data. Factors include payment history (35%), amounts owed (30%), length of history (15%), new credit (10%), and credit mix (10%). You check scores separately via banks or services.

You spot errors fast by scanning your credit report's personal info, accounts, inquiries, and public records for mismatches. You file disputes correctly through Equifax, Experian, or TransUnion portals, by phone, or certified mail with clear details and evidence. Bureaus investigate within 30-45 days and must delete unverified items.

• Review personal section first: Verify name, SSN, address, DOB against your records.
• Check accounts: Flag unrecognized debts, wrong balances, or late payments you dispute.
• Scan inquiries: Note hard pulls without your consent.
• Examine public records: Challenge bankruptcies or judgments over 7-10 years old.
• Gather proof: Collect statements, payment records before disputing.
• Use sample dispute letter: "I dispute [item] as inaccurate because [reason]. Enclosed: [evidence]."
• Track online: Monitor status at bureau sites during 30-45 day window.
• Repeat yearly: Get free weekly reports at AnnualCreditReport.com for ongoing checks.

Prioritize accounts to fix first

• You fix recent late payments first; they harm your credit score most (within last 2 years).
• Next, pay down revolving accounts with high balances over 30% utilization.
• Tackle charged-off accounts or collections over $100; negotiate pay-for-delete.
• Ignore old negatives (over 7 years); they drop off automatically.
• Space payments: one account per cycle to build positive history.

You lower **credit utilization** - your balances divided by credit limits - through targeted payments. Aim to keep it below **≈30%**, a common recommendation that boosts your **credit score** (lower ratios help even more). Pay balances multiple times monthly, especially before statement closing dates. Always pay more than the minimum to shrink balances fast.

Request credit limit increases on low-utilization cards (avoid new applications). For high debt, consider a short-term personal loan to consolidate, but weigh interest costs, potential hard inquiries, and your repayment ability first - the loan impacts credit like other debt. Track progress on your **credit report** monthly.

You negotiate collections by contacting agencies to settle for less than owed or request deletion from your credit report. Agencies often accept 30-70% settlements, but amounts vary by debt age, collector, and your offer. Pay-for-delete agreements are rare; most only mark accounts paid.

1. Verify the debt: Send a debt validation letter within 30 days of first contact.
2. Research: Check debt age against your state's statute of limitations (typically 3-6 years).
3. Call the agency: Ask for the supervisor. State you want to settle.
4. Offer a lump-sum payment (e.g., 30-50% initially). Negotiate up if needed.
5. Request pay-for-delete in writing: Propose deletion upon cleared payment. Many refuse.
6. Get everything in writing before paying: Confirm settlement amount, terms, and deletion (if agreed).
7. Pay securely: Use certified check or money order. Keep records.
8. Check your credit report 30-45 days later via AnnualCreditReport.com. Dispute if needed.

You rebuild credit using secured cards, credit-builder loans, and rent reporting. These tools add positive payment history to your credit report. You make on-time payments, which bureaus report to build your score over time. (Expect gradual improvement in 3-6 months with consistent use.)

• **Secured cards**: Deposit cash as your credit limit. Use lightly, pay fully each month. Builds history like regular cards.
• **Credit-builder loans**: Borrow small amounts held in savings. Repay monthly; lender reports payments. Ideal for thin files.
• **Rent reporting**: Services report on-time rent to bureaus. Covers past/present payments. Boosts score without new debt.

You build credit from zero with a thin file by adding new positive accounts that report to Equifax, Experian, and TransUnion, then paying on time.

A thin file shows little credit history, making scores hard to generate or low. You create history through starter products and responsible habits. Aim for under 30% credit utilization once you have revolving accounts. Make all payments early.

Open a secured credit card; deposit $200-$500 as your limit (e.g., Discover it Secured). Take a credit‑builder loan from a credit union; payments build savings and history (e.g., Self or Credit Strong). Report rent via services like Rental Kharma. Ask to become an authorized user on a family member's card, but only if their issuer reports your activity to bureaus - not all do, and it won't automatically inherit full history. Use Experian Boost for free utilities/phone payments.

• Report identity theft to FTC at IdentityTheft.gov. File a police report. Place a free fraud alert (1 year) or extended alert (7 years) on your credit reports at Equifax, Experian, TransUnion.
• Freeze your credit with all three bureaus to block new accounts. Dispute fraudulent items online or by mail with proof like the police report; bureaus must investigate within 30 days.
• For co-signed defaults, contact the lender immediately. Negotiate a payment plan or settlement since you remain liable. Send goodwill letters requesting removal after payoff.
• Dispute co-sign errors if payments weren't reported correctly; provide loan docs as evidence.
• Ignore medical debts under $500; they typically don't report. Unpaid collections wait one year (365 days) to appear per bureau policies. Paid medical collections auto-remove.

You hire credit repair help when DIY disputes fail after 3-6 months, identity theft complicates matters, or multiple bankruptcies demand expertise. Professionals save time on voluminous disputes you lack bandwidth for.

You avoid scams by rejecting companies demanding upfront fees (illegal under CROA), promising "guaranteed" deletions, or discouraging direct bureau contact. Verify via FTC's CROA guidelines; check BBB ratings and real reviews first.

You see initial progress in 3 months, steady gains by 6 months, and notable changes after 12 months, but timelines vary by your credit history, dispute success, and habits.

• **3 months:** You file disputes and correct errors on your credit report. Bureaus respond in 30-45 days. You lower credit utilization. Your credit score may rise 10-30 points if starting low.
• **6 months:** You remove more inaccuracies and negotiate collections. Positive payment history builds. Your score often improves 20-50 points, depending on your actions.
• **12 months:** Many errors clear from your credit report, though derogatory marks like late payments linger up to 7 years. Your score gains 20-100 points typically, but results vary widely.

You control outcomes with consistent effort. Track via AnnualCreditReport.com. Patience pays off.