Can You Restore Your Credit Rating Without Professional Help?

Can You Restore Your Credit Rating Without Professional Help?

Do you want to restore your credit rating?

Please note that we are talking about restoring the credit score of an individual.

Most of us pay attention to our credit score only when it prevents us from getting a loan at favorable rates. Then we try to find ways to raise credit score instantly and set everything right. Rebuilding your credit is not an easy task and requires a planned approach.

Restore Your Credit Rating

Does that mean you cannot repair your rating without professional help?

The answer to this question is neither simple nor straightforward. You will have to dig deeper into the topic of score restoration to know whether credit repair services are useful or not. Furthermore, the answer will depend on the exact nature of your case. If you are researching ways to restore your credit rating, then don’t skip this article.

Before you find out whether you can do the repair job yourself or not, you must…

Know the Law

The desire to raise credit score instantly has created a huge demand for repair services. There are many agencies in the business, that provide effective assistance. However, many unscrupulous elements have also entered the picture to prey on unsuspecting needy clients.

They made false claims regarding what they could do for a client. This led to customers getting cheated out of their hard-earned money. The government took note of the scams and formulated a law that protects you when you hire an agency to restore your credit rating.

Law is the embodiment of the moral sentiment of the people.

William Blackstone

Laws are made to ensure justice is done and human sentiments are satisfied. The Credit Repair Organizations Act (CROA) was enacted in 1997 to regulate the functioning of credit repair services. The Act ensures that even if a company claims to raise credit score instantly, it cannot:

  • Start work on a case without a written contract with the client. The company must list all the services it has agreed to provide along with the relevant terms and conditions. Remember that you can exit a contract within three days.
  • Ask for payment from a client without completing the agreed-upon services.
  • Provide wrong or misleading information to a credit reporting company to restore your credit rating.
  • Ask clients to sign a document to forfeit their rights listed under the Act.

The law has created a framework that regulates the functioning of repair services and prohibits them from making fraudulent claims to raise credit score instantly. It has helped in minimizing the instances of wrongdoing against customers. The Consumer Financial Protection Bureau penalizes repair agencies that are found to break the law.

You must be wondering that since there is a specific law for governing repair services, then is it mandatory to hire them for restoring bad credit?

The simple answer to this question is…

No, you can also choose to restore your credit rating by yourself.

But, there is another important factor to consider before you take matters into your hands. Think carefully and answer the following two questions:

i.  Do you have the skills to handle the restoration process?

ii. Do you know exactly what needs to be done to raise credit score instantly?

If you answer in the affirmative, then you do not need to read the rest of the content. But if your reply is no, then it will be sensible to look for professional help.

Those of you who are unsure about the answers, read on to know more about the topic.

How Can You Restore Your Credit Rating By Yourself?

Let’s say you decide to fix the problem without hiring an agency. Here is an overview of what you would have to do.

1. Analyze Your Credit Reports

You need to know the exact state of your credit history before embarking on the project to repair it. Download your credit reports from the main reporting companies.

There are three main credit bureaus namely  Experian, TransUnion, and Equifax. These agencies prepare the reports by tracking an individual’s financial transactions’ history. Go through the reports to identify inconsistencies or any information that you know is incorrect.

To raise credit score instantly, it is important to bring these anomalies to the notice of the specific bureau in whose report they were mentioned. You must file a dispute with that agency. Another way is to communicate the error to the creditor that reported it in the first palace.

2. Make Payments on Time

The credit scoring model depends heavily upon your payment history. Any delays or missed payments will adversely affect your report. Such negative elements can remain on a report for at least seven years. To restore your credit rating, it is vital to never miss or be late in making payments.

The reporting bureaus factor in the size of your debt and the schedule of your missed/ late payments. The more your debt amount and the recent your missed payments, the poorer your score will be.

Make a list of the bills that are pending. Create a schedule based on their last dates and ensure that the specified amounts are paid before schedule. This is one of the most crucial tasks to raise credit score instantly.  

3. Avoid High Credit Utilization

What is your credit utilization ratio?

Do you know the answer to this question? Let’s put it in simpler terms.

Do you know the percentage of your credit limit you are using at present?

Knowing your credit utilization ratio is crucial to restore your credit rating. It is calculated by dividing all your debt by the total available credit and multiplying it by 100. Let’s explain it with an example.

Let’s say your complete debt amounts to $5,000 and the available total credit limit is $50,000.

Your credit utilization ratio   =  $5,000  X 100/ $50,000 = 10%                                                 

If the credit utilization is on the higher side, then it can have a negative effect on your report. To raise credit score instantly, it is suggested that you maintain a ratio of around 30%. 

4. Open and Close Credit Accounts Carefully

Some people don’t think too much while opening or closing credit accounts.

Do you know that this can also affect your credit score?

The scoring models consider the age of your credit accounts. This is to find out the length of your credit history. Individuals with a long track record of spotless credit history can expect to achieve a high score.

To avoid situations where you have to restore your credit rating, you must maintain a credit card account even if you are not using it. If you have paid all the bills related to the account, then keeping it open will help in boosting your credit.

Similarly, you must be careful in opening new accounts. If you open multiple accounts in a short period, it can set alarm bells ringing among creditors.

Consider whether you really need the new card before making a decision. You do not want to land in a situation that causes you to miss or delay payments and then you are left looking for ideas to raise credit score instantly.  

Are there are some other ways for repairing bad credit?

You can also take credit-builder loans from community banks or credit unions. The sole purpose of such loans is to help improve your credit. Another idea is to get someone to make you an authorized user on a credit card. Even if you don’t use the card to make payments, your credit history will be enriched by just being associated with the account. 

We started by seeking the answer to whether users can repair bad credit by themselves or not. It is now clear that they can handle the issue by themselves. But an even more important question now faces someone suffering from bad credit.

Should You Try To Restore Your Credit Rating Without Professional Assistance?

We explained the steps required to repair a bad score. There is no magic trick to fix things immediately. You need to create an action plan based on your specific case and then execute all the steps carefully. Those who wish to raise credit score instantly must be wary of untrustworthy operators.

In a nutshell, there are two important points to consider:

i. Expertise

Do you have what it takes to fix the problem? Are you aware of the procedure to download reports and file dispute claims with bureaus? As mentioned earlier, there is no shortcut to restore your credit rating.

You have to strategize and follow a structured course of action to achieve the best possible results. If you are not aware of the right way to handle the technicalities of the process, then it will be better to let a professional do the job.

ii. Time

Do you have the time to do the tasks needed to raise credit score instantly? It is important to diligently study your reports to identify errors. You will have to collect documentary evidence to contest the wrong information on the reports. Remember that it’s tough to determine a time period within which the repair job will be completed.

When you hire a professional service, then it will handle all the necessary tasks to fix the problem. If you have the expertise and the time to restore your credit rating, then you must do it yourself. However, it will always be better to let an expert handle the matter.

It can be safely said that if you choose to manage things by yourself, then it may take you longer than a professional service. The objective to raise credit score instantly cannot be achieved in a pre-defined time period. There are various factors at play and no credit repair company can commit to a timeline to fix the issue.

You must now be thinking that even if you hire an expert…

How Long Will It Take To Restore Your Credit Rating?

The exercise to fix the problem will depend on your credit history. The seriousness of the negative items on your report and when they occurred will have an impact on the time required to negate their effect.

When you dispute a negative item, the agency has to send a response within 30 days of receiving the claim. If the bureau finds your complaint to be valid, it will remove the wrong information but the change will be reflected in your report only when the score is calculated again. Moreover, to raise credit score instantly you must check and file disputes with all the major bureaus.

Hiring professional credit repair services with a good track record will be a better option than trying to rectify the situation by you.

Don’t Take Your Eyes off The Ball

After you restore your credit rating, it is important to not let things go out of control again. Make it a habit to monitor your credit regularly. This will help you in spotting anything that can snowball into a big problem.

The objective is to avoid situations that necessitate hiring services to raise credit score instantly. For example, if you see a wrong item, report it immediately to the concerned agency. This will help in removing it quickly before it damages your score.