If there are entries on a person’s credit file that are affecting the overall credit score negatively, there are practices that may be followed in order to help ‘repair’ that person’s credit score and improve their overall credit worthiness in the eyes of lenders.
A person has two options to do this. Firstly, use one of many credit repair law firms to act on a client’s behalf to improve credit ratings or secondly, repair the credit history themselves.
Repairing bad credit history is a lengthy process though it is also quite simple. In order to improve a credit file, existing finances must be in good order. It is impossible to improve a credit score if repayments are currently being missed.
By requesting a credit report from a bureau such as Experian or Equifax, the full breakdown of a person’s credit history can be seen. This will include entries for all existing credit products and also for any credit applications made in the past and possibly old entries from credit that may be from closed accounts.
The first port of call should be to remove any old and out of date entries from past credit. This could be from a loan for example that has now been paid off but is still showing as not complete on the credit history. The credit bureau must be made aware of such entries and this may need to be done by requesting the lender updates the credit bureau stating so. In addition it is not uncommon that fraudulent activity has resulted in two people’s data being merged onto one credit file. Again if this is the case the credit bureaus must be notified to make amendments. It may take such amendments a month or two to be updated but by doing this the credit history will be improved resulting in a better credit score and credit worthiness for that individual.
To repair bad credit further, it is a necessity to act responsibly toward a lender. In other words the account must be kept in good standing. Examples of this include not being late on a repayment, not exceeding credit limits and only using about 30% of the available credit. If accounts are kept in line with the lenders agreements, credit will be repaired naturally and therefore credit scores for that person will be improved over time.
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