Credit Restoration

It is a reality that many people are faced with the time consuming task of credit restoration. Some may have made bad decisions or suffered income loss and found themselves overextended. A lot of consumers have fallen victim to unemployment in the past year and with the economy in its current state, its been quite difficult for a lot of good citizens to get back on track. Some may have late payments. Some people are facing charge offs because they cant make their regular monthly payments. The restoration process isn't as difficult as many people may think though. It takes time and consecutive monthly payments, but it can be done.

First, you need to obtain a copy of your credit report from all three of the major credit reporting agencies. The "big three" are Experian, Equifax, and TransUnion. Its suggested to pull a credit report from all three because information may be different with each bureau which could be disputed for erroneous reporting and possibly eliminated just by submitting a simple dispute letter! Creditors are not required to report to any of the agencies, and often they will report to just one. Having all three credit reports on hand will help make restoring your credit easier and more thorough. The FACT Act passed by Congress allows consumers one free copy of their credit report per year. To get your copy, go to annualcreditreport.com. They do not ask for a credit card to authorize or any sort of payment unless you want your official numeric FICO score which is not necessary to evaluate whats on your credit and how its affecting you.

Once you have the credit reports in hand, go over them with a fine tooth comb. Check for any errors such as paid off accounts reporting as delinquent or accounts that you have never opened or used. This is also a good way to check if you've recently been a victim of identity theft. Also check for accounts in which the reporting period (7 years) has expired. If you find errors in your report it is essential that you contact the credit bureau to have your file corrected or updated. All bureaus provide the convenience of disputing items online and you can do so while reviewing your credit report.

The final and most essential step is to change the way you use credit going forward. That includes making all payments on time and not exceeding your credit limits. While it may be true that it's virtually impossible to go through life today without using credit, you can use it wisely and not end up in trouble down the line. Having only one major credit card open is a good way to start to achieve financial freedom. It may be hard, but closing and consolidating your cards can reduce your interest rates to a lower fixed rate and eliminate any past due, late, or over limit fees you may be incurring if you're behind.

Restoring your credit is easy but time consuming. There is no easy quick fix and any agency offering such is most likely buying your business and not having your best interest in mine over their own profiting bottom line. Going forward, this process can be avoided by evaluating your use of credit and seeing where changes can be made now. Assess your monthly budget to see whats coming in and whats going out on a regular basis is key to understanding your personal financial situation. Most true non-profit agencies offer free budget counseling and can help make suggestions on how you can save on your current bills and better manage your finances to ensure you don't fall behind again. For a free budget counseling session or more information of credit debt consolidation contact a certified credit counselor for a free consultation. Please remember to always verify a companys reputation with the Better Business Bureau to avoid scams.