My name is Joe Mahlow, and I have been working in Personal Finance and Credit for a long time, and I love helping people out by writing informative posts on various topics that concern them. In this post, we'll be talking about Credit Repair for Free and the various questions surrounding it. It is possible to repair your credit without any cost, but I should inform you beforehand that it requires a lot of hard work. However, if you're willing to put in the effort, you can easily save yourself a lot of time and money. So, let's get started.
Table of Contents
Free Credit Repair: Is It Possible?How to Fix Your Credit for Free: A DIY GuideIs it Possible to Use Credit Repair Software for Free?Free Credit Repair: Obtaining Your Credit ReportsCan Credit Repair Improve My Credit Score?Final Thoughts on Credit Repair
Free Credit Repair: Is It Possible?
When you see advertisements offering free credit repair, it is important to remember that there may be more to the story. No individual or business is likely to offer their services for free unless they stand to gain something in return. For instance, when I first started working in credit repair 15 years ago, I offered free services in order to gain client testimonials and reviews and to establish my reputation. Today, my company, ASAP Credit Repair, still offers free credit repair, but only for one round of services. You must enroll and pay the service fee to get started.
While it is possible to repair your credit on your own for free, this will require a significant time commitment. I recommend disputing your credit reports for free but be prepared to set aside 1-2 hours per month for at least 3-5 months to complete all necessary steps. If you do not have the time to undertake your own credit repair, consider finding a credit repair service or company. Although credit repair can cost the typical customer $400-600, having a professional handle the process can be worth the investment.
How to Fix Your Credit for Free: A DIY Guide
Fixing your credit on your own might seem a bit daunting, but it isn't as difficult as you may believe. Although it may require some time, it is not an impossible task. It is essential to keep in mind that disputing your credit reports online is not recommended. By doing so, you are relinquishing your legal right to dispute your credit report more than once per year. Furthermore, the online dispute process is obsolete and ineffective and could hinder you from obtaining favorable outcomes.
Based on my experience, the credit repair process is a 70/30 ratio, where 70% of your time is utilized for research and credit report pulling, and 30% is spent drafting your credit disputes. To simplify the process, here is a step-by-step guide to repairing your credit on your own for free.
1. Access your credit reports online.It is highly recommended to use a credit report provider that offers the most available data to identify any errors on your credit report. My personal recommendation is Identity IQ.
2. Understand what disputing means.You must be familiar with two laws that protect you as a consumer and outline the guidelines for disputing your credit report: the Fair Credit Reporting Act (FCRA) and the Fair Debt Collection Practices Act (FDCPA). Although it is not necessary to read them, you must know your legal rights.
3. Draft up your own dispute letter.Do not rely on online "gurus" for dispute letter advice. Creating a dispute letter using Google Docs or pen and paper is easy. Google the Credit Reporting Agencies Addresses (Equifax, Experian, and Transunion) and take the creditor's address at the bottom of the credit report, and set them aside. Then, provide your name, address, date of birth, and last four of your social on the letterhead. Identify the account name and account number you want to dispute and draft the body of the paragraph. In the body of the paragraph, request that the account be validated by providing proof of the account's authorization, such as a Credit Application, the ledger balance history displaying all payments made on the account with dates and times, and all monthly billing statements provided since the account's opening. Conclude the letter and sign it.
4. Wait 30 days.If they do not provide the documentation for each account you disputed, send a secondary dispute letter via certified mail stating that you did not receive the requested documents. Then, either request the account's deletion if it's a charge-off or collection or request the removal of the late payment history if it's an account with late payments.
5. Rinse and repeat.If you continue to encounter problems, consider contacting ASAP Credit Repair or other reputable credit repair firms. Keep your dispute letter simple and to the point, and feel free to use Google to locate dispute template letters for reference, but never use any online template letters.
Is it Possible to Use Credit Repair Software for Free?
When I initially began working in the credit repair industry, my first step was to search for a tool to simplify the process of developing dispute letters, allowing me to offer a smoother experience to my clients. Credit repair cloud software was the sole available option at the time, and it has since evolved. Although it was initially designed to help credit repair firms assist their clients in resolving credit issues, it is also suitable for personal use. A free 30-day trial is available, which allows you to generate your first dispute letter. It is an excellent secondary option for individuals looking to manage their own credit repair process for free, as it provides a step-by-step guide and a wealth of information on credit repair. Additionally, Credit Repair Cloud has a range of dispute letters and tactics, as well as different dispute reasons, that can assist you in creating customized dispute responses tailored to your account's specific needs. However, keep in mind that the free trial only provides access to their 1st round dispute letters, and you will need to generate future-round response letters manually or upgrade to the premium version of the software in order to complete the credit repair process. It may be worthwhile to explore the other credit repair software options available on the market, of which there are approximately 10, to determine which best suits your needs. Perhaps once you've gained a better understanding of the process, you can even launch a credit repair business and assist others in repairing their credit.
Free Credit Repair: Obtaining Your Credit Reports
In order to repair your credit for free, you will need to obtain copies of your credit reports from all three major credit bureaus – Equifax, Experian, and TransUnion. As you familiarize yourself with credit repair, you may choose to dispute with all credit reporting agencies and data furnishers, but starting simple is recommended. Accessing your credit reports not only helps you identify derogatory accounts to include in your disputes but it also raises an important question: which credit report should you use?
The short answer is that not all credit reports are equal. Most lenders who approve loans will pull your Fair Isaac Corporation (FICO) report, but the high cost of accessing this report makes it best left until the end of your credit repair journey. Instead, the best option for initially gaining insight into your credit is the VantageScore report, which is significantly less expensive and provides identical data to the FICO report.
So, what is the most effective credit repair credit report? Based on our experience, IdentityIQ provides the most comprehensive credit reports compared to any other credit monitoring site. While the data feed is the same as other VantageScore reports, IdentityIQ offers additional data that can help you identify more errors on your credit report and, in turn, achieve better results. However, it is not mandatory to use IdentityIQ – as long as you access all three credit reports from a reputable credit monitoring site, you can achieve results.
Can Credit Repair Improve My Credit Score?
In short, yes, but credit repair should be seen as just one aspect of improving your credit score. It's crucial to also have a solid foundation of established credit and a history of timely payments to continue boosting your score. Despite common misconceptions, credit repair won't solve all credit issues, and inaccurate accounts on a credit report are typically the only ones that can be removed.
So, how does credit repair help to improve your credit score?
1. Removing negative payment history or negative accounts can often lead to a higher credit score. However, having positive revolving and installment accounts reporting is equally important, or the credit score increase may be minimal.
2. Maintaining good payment history on active accounts is essential in maintaining a healthy credit score. For those starting to build credit, it's recommended to begin with a secured credit card to help build credit quickly.
In conclusion, while credit repair can be a powerful tool in improving credit scores, it's crucial to maintain established credit, make timely payments, and keep credit card balances low to ensure maximum benefits from credit repair efforts.
Final Thoughts on Credit Repair
In my 15 years of experience in the industry, I have come across many individuals who do not take the initiative to start the credit repair process simply because they do not know how to begin. To avoid this, take a small step forward and either educate yourself on credit repair and create your first dispute letter or consider hiring a credit repair company to do the work for you. Inaction will only lead to lost opportunities. Taking the initiative to repair your credit now can save you thousands of dollars in paid interest over the next few years. If you are unsure about choosing a credit repair company, feel free to contact ASAP Credit Repair. We offer free consultations and evaluations and understand the importance of helping our clients restore their credit quickly.