7 Common Credit Repair Myths

As we all know, our credit score is used to determine our financial reliability. Unfortunately, those who have a low credit score often have difficulty with many different prospects.

This can include moving into an apartment, securing a loan, etc. Although it’s possible to fix poor credit, there are many credit repair myths out there that you need to be aware of.

We’ve put together a short guide that details what you should know. Let’s dive in.

1. It Takes a Long Time to See Improvement

This is one of the most common myths that people believe about credit repair. Although you won’t be able to repair your score within a day or two, you’re able to do so far more quickly than you might anticipate.

Since credit bureaus update individual credit scores every 30 days, you could see significant changes in as little as one month. Within a 12-month period, it’s entirely possible to take your score from undesirable to stellar.

2. Those With Poor Credit Must File for Bankruptcy

Unfortunately, those who are not educated about managing a poor credit score often resort to filing for bankruptcy. As you might expect, this can have a large number of consequences that last for years afterward.

In general, filing for bankruptcy is something that should only be done as a last resort. The good news, though, is that you have a handful of options that you can take as an alternative.

Paying off outstanding debt, for example, could significantly raise your score in some circumstances.

3. Paying off Your Debt Fixes Your Credit

It’s important to note, however, that paying off debt does not always fix a credit score. Although it will reduce your revolving credit utilization (which is a factor used to determine your score), these debts won’t be removed from your credit report.

For those who are unaware, negative items on your credit report will remain there for 84 months. This could significantly impact your ability to open a business or secure a mortgage for a house.

In some cases, you can pursue the removal of a particular debt if you believe that it is either outdated or inaccurate. To elaborate, let’s assume that you were mistakenly held responsible for a family member’s debt.

If you find that this amount is negatively affecting your credit score, there’s a chance that you could have it removed entirely as long as you are not obligated to make payments on the debt.

4. Credit Repair Is a Scam

It’s understandable that people have this belief. After all, credit repair often seems too good to be true.

However, there are plenty of reputable companies that specialize in credit repair that you can take advantage of. When searching for one that can help, be sure to take a look at their past reviews.

This will give you plenty of insight into the type of experience that you can anticipate having with them.

5. Credit Reports Are Always Accurate

It might come as a surprise to learn that credit reports are not always 100% accurate. In fact, many people tend to encounter errors when reviewing their own credit reports.

If left unhandled, you could experience a blow to your credit score for something entirely out of your control.

In most cases, those who are vigilant about keeping financial records will be able to provide enough evidence to support their claim. If you need a bit of additional help, though, it’s highly recommended that you reach out to a professional.

6. You Can Easily Fix Your Credit on Your Own

It’s not impossible to fix a poor credit score by yourself. But, it’s often notably difficult to do so.

In this case, you’ll have a large number of responsibilities that you will need to handle. First, you’ll need to gather financial records that you can use as supporting evidence.

Then, you will need to reach out to the appropriate parties and request the removal of certain segments of your credit report. Specifically, these are items that are outdated or erroneous.

From here, you will need to wait until a decision is made. It’s possible to get a legal professional involved in the process, but it’s often not worth the money to do so unless you have a comprehensive plan.

For this reason alone, many individuals tend to work with credit repair companies. These firms are able to negotiate with credit bureaus and help you reach a favorable outcome.

7. Items Erased From Your Credit Report Can Resurface

For some reason, there is a notion that credit bureaus maliciously add negative items back onto your credit report even after they have been removed. The most common worry is that someone who had a dispute resolved in their favor will have this decision reversed.

But, there is only one circumstance in which this can happen. If a debt was removed from your credit report but was later found to be valid, it can be added back.

In the vast majority of scenarios, though, you will never have to deal with a negative item again once it has been cleared from your record. So, keep this in mind when preparing to dispute certain items on your credit report.

Credit Repair Can Seem Difficult

But, working with the right credit repair professional can help get you back on track as soon as possible. Want to learn more about what we have to offer? Feel free to reach out to us today and see how we can help.

Don’t let bad credit hold you back from the life you want.