How to Improve Your Credit Record
If you have a history of late payments, unpaid bills, or accounts sent for collection, your credit record will suffer. A bad credit record gives you a low credit score and makes it difficult for you to get needed credit or loans for things you really need.
Your credit history
Most everything you do with credit, both good and bad, is reported to a credit reporting agency. A history of paying late, or not paying at all, is sent to credit reporting agencies. Bankruptcies, judgments and liens also find their way to your credit report and hurt your credit rating.
The good news is that positive information is also sent to credit reporting agencies. To keep track of your credit standing, you should review your credit report at least once each year. You can correct errors and clean up any wrong information that might be on your report. Review Your Credit Report and Correct Errors.
How to Improve your credit rating
Here are some of the best ways to improve your credit rating:
If a creditor agrees to take information off of your report in exchange for full or part payment, get their promise in writing before you pay. If you pay the balance, even without an agreement, they must update your credit report to reflect a paid-in-full status. If you discharged debts in bankruptcy, those items can still be included in your credit report.
Credit repair companies promise to improve your credit. They may also promise to get you a loan or a credit card. They lead you to believe that they have special ways to get negative information off your credit report. They don’t.
Credit repair companies have no special powers to improve your credit. There is nothing they can do for you that you cannot do yourself. Paying them leaves you less money to pay your current bills and past debts.
Because of the problems with credit repair companies, strict laws were passed to regulate their activities. For example, they must provide a written contract that you can cancel within five days. They can’t require payment in advance and all promised services must be completed in 90 days. They must also register with the Department of Justice and file a $100,000 bond with the Secretary of State. Be aware that very few credit repair companies follow the law.
Civil Code 1789, 15 U.S.C.A. §1679 et seq.
Contact us for more information or speak with one of our counselors at (800) 593-8222. If you live outside of Southern California, call us at (213) 974-1452.
Updated Apr. 26, 2011
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