Best Ways to Repair Your Credit Report
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Your credit report is an important document that influences how much financing you receive from lenders. Financial institutions will review your credit history and financials to see if you can reliably keep up with the monthly loan payments.
If you don't have the best credit score, it can be difficult to get the financing you need. Borrowers with low credit scores will also face higher interest rates, which result in higher monthly payments.
Repairing your credit report can help you qualify for more loans and get better terms. Having a good team behind you can make the process easier. This guide will explore some of the top credit repair companies to determine which is right for you.
In this article
Best Ways to Repair Your Credit Report
1. Check your credit report for errors
Consumers can take many steps to improve their credit scores, but you can get a quick win immediately. The three major credit bureaus — Experian, Equifax, and TransUnion — let you receive a free copy of your credit report every year. You can look through one of these reports and look for any errors, such as an inaccurate late payment or a line of credit that shouldn’t be there.
You can dispute any errors with the credit bureau and instantly improve your score if the credit bureau determines the item in question is an error. This strategy can generate quick wins but won’t be a game-changer. Checking your credit report for errors doubles as a way to see if you have become a victim of identity theft. If there are any suspicious accounts, it can be a sign that someone is taking out loans and lines of credit using your name.
2. Catch up on your debt
Consumers’ credit scores get damaged for various reasons, but almost all revolve around missed debt payments. Your payment history is the largest component of your credit score, making 35% of the total calculation.
Catching up on missing loan payments and credit card payments can help you repair your score. If you have many small financial obligations that feel overwhelming, you may want to consider a debt consolidation loan.
These loans allow you to combine all your debt under one umbrella. You can opt for a debt consolidation loan with many years on the back end to minimize your monthly payments. You may even secure a lower interest rate with a debt consolidation loan than the interest rates on your smaller loans and lines of credit. These loans can be especially useful for credit card debt.
Once you catch up on your debt, pay your bills on time. Setting a budget and reviewing your expenses can help you trim your costs and open up more space for covering your monthly bills. Picking up a side hustle can also help. Catching up on debt is great, but you don’t want to fall back into the same cycle by getting overconfident and missing bill payments.
3. Reduce your credit utilization ratio
Catching up on your debt is a good starting point to repair your credit report. Every credit-building strategy focuses on paying off debt, but you can also progress by focusing on your credit utilization ratio.
The credit utilization ratio measures how much money you have borrowed against your credit limit. If you have a $3,000 credit limit and have borrowed $1,500 against it, you have a 50% credit utilization ratio. That’s not the best number for people who want to improve their credit scores.
A credit utilization ratio below 30% can boost your score, but getting this number below 10% is ideal. Paying off your balance is the best way to reduce your credit utilization ratio. If you have a lot of credit card debt, you can start by making more than the minimum monthly payment. Going beyond the minimum will help you make more progress with paying off the principal before interest accumulates.
4. Do not apply for new credit
Paying off debt and improving your credit utilization ratio will improve your FICO score, but you also have to stay away from new credit lines and loans. When you apply for a credit card or loan, your lender conducts a hard credit inquiry. This hard credit check will reduce your credit score by a few points.
While the reduction isn’t much, recovering from a hard credit check can take a few months. These credit checks can add up if you constantly apply for new credit. While products like debt consolidation loans can help you get out of debt sooner and keep up with debt, you should not take out new credit to increase your purchasing power. Building your score first is more important to get better terms later.
If you plan to apply for a mortgage or an auto loan in a few months, you should avoid taking out new credit. It is a good idea to save your hard credit checks for these financial products if you do not need to open new credit lines or loans to access additional funds.
5. Rebuild your credit with secured financial products
If you do not have the best credit score, obtaining traditional loans and credit cards can be hard. However, you can still access financing to build your payment history. Secured credit cards and credit builder loans are easier to acquire than unsecured financial products.
Secured credit cards and credit builder loans both require security deposits. If you want to borrow a $500 credit builder loan, you must first deposit $500. If your security deposit for a secured credit card is $500, your credit limit becomes $500. You will receive the security deposit back when you pay off a credit builder loan or close your secured credit card.
The advantage of secured credit cards and credit builder loans is that you do not need good credit. Lenders will skip hard credit checks since you already provide a sufficient security deposit to pay off the debt.
These products aren’t the best for borrowing money, but on-time payments will strengthen your payment history. A better payment history will significantly improve your credit score and help you qualify for better financing in the future.
6. Keep your old accounts open
Do you have an old credit card you haven’t used for several years? While it may seem tempting to close this account to simplify your finances or give you one less thing to worry about, closing your old accounts is not a good idea.
Credit age isn’t the largest component of your credit score, but it still makes up 15% of the total calculation. Keeping old credit accounts open increases the average age of your credit accounts and leads to a higher score.
Most credit accounts don’t need much effort to keep them open. You only need one monthly subscription on your older credit card, regardless of the amount. If you have a $2/mo subscription on your old credit card and deposit $24 into your credit card, you won’t have to look at it for two years, assuming no price hikes or fees.
Paying the small monthly subscription on time will fortify your payment history. However, how you handle your more active credit accounts will determine most of your payment history.
7. Stay accountable and celebrate your progress
Repairing your credit takes time. While checking your credit report for errors and disputing any inaccurate items you find can result in quick wins, credit building is a long-term journey.
Some people get excited about repairing their credit for a few days, only to return to the financial habits that brought them into this situation. Consumers have to stay accountable to themselves throughout the process and commit to financial habits that will benefit their credit scores.
Pursuing a side hustle and tapping into new career opportunities will make it easier to cover existing debt and stay on top of future expenses. Taking a very careful look at your non-essential expenses can lead to significant savings. Trimming non-essential expenses reduces debt accumulation and gives you more money to cover current debt.
Keeping yourself accountable makes it easier to turn a sudden desire to improve your credit score into a long-term goal with a happy ending. Before you reach that happy ending, you should celebrate the mini milestones.
Consumers with 600 credit scores hoping to get up to 700 should celebrate every time they add 10 points to their credit score. Acknowledging small wins can build momentum and help you stay focused on the long-term goal.
Celebration isn’t code for spending money on things you don’t need. Taking a few minutes to recall your journey and how you got here can fill you with gratification while allowing you to set your sights on the next milestone. Mini-celebrations can give you more motivation to continue to grow your credit score at a faster pace.
It’s possible to go from a bad credit score to a great credit score. Making marginal gains and setting long-term goals around your credit and finances can help you reach key milestones.
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Seek credit repair help
While many individuals successfully navigate the credit repair journey on their own, there are situations where enlisting the services of a reputable credit repair company can be a smart and effective choice. Here is when turning to a credit repair company might be the way to go.
Complex credit issues
If your credit report is marred by complex issues, such as multiple inaccuracies, erroneous accounts, or identity theft, a credit repair company can provide valuable expertise. They have the experience and knowledge to navigate the intricacies of credit reporting, dispute processes, and legal regulations. They can efficiently identify and dispute errors on your behalf, potentially accelerating the credit repair process.
Time constraints
Repairing credit can be a time-consuming endeavor, requiring patience and dedication. If you have a hectic schedule or lack the time to dedicate to credit repair, a reputable credit repair company can take on the responsibility. They'll manage the dispute process, track progress, and keep you updated, allowing you to focus on your daily life without sacrificing your credit goals.
Negotiating with creditors
In some cases, creditors may be willing to negotiate with credit repair professionals more readily than individual consumers. Credit repair companies often have established relationships with creditors. They can advocate on your behalf to negotiate settlements, lower interest rates, or arrange payment plans, which can lead to more favorable outcomes.
Legal expertise
Credit repair companies are well-versed in the intricacies of credit laws, including the Fair Credit Reporting Act (FCRA) and the Fair Debt Collection Practices Act (FDCPA). If you believe your rights have been violated or are dealing with debt collectors engaging in unlawful practices, a credit repair company can provide legal guidance and support.
Personalized plans
Reputable credit repair companies create customized credit repair plans tailored to your specific financial situation. They assess your credit report, identify areas for improvement, and implement a personalized strategy to address your unique needs and goals.
Accountability
When you work with a credit repair company, you gain an advocate dedicated to your credit restoration. They'll track progress, handle correspondence with credit bureaus, and provide transparency. This level of accountability can be reassuring and motivating as you work toward your credit goals.
Education and counseling
Many credit repair companies offer educational resources and credit counseling to help you develop healthy financial habits. This guidance can empower you to maintain good credit long after completing your credit repair journey.
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Credit repair companies
Credit Saint
Credit Saint is a top credit repair company with an A rating on the Better Business Bureau. Over 200,000 clients have used the company's services since 2004. The company offers a 90-day money-back guarantee for its new clients.
You can get started with a free consultation to discover how Credit Saint can repair your credit score. Credit Saint will conduct a soft pull on your credit report, which will not impact your score. The company uses this report to learn about your credit profile and detect errors.
Credit Saint's plans include a score tracker, score analysis, and challenges to the three credit bureaus. Picking more advanced plans unlocks additional features, such as identity theft protection, personalized credit building guides, inquiry targeting, a $1 million theft insurance policy, and other perks.
Credit Saint's lowest plan is $79.99/mo with a $99.00 initial working fee. The company's highest plan is $129.99/mo with a $195.00 initial working fee. Credit Saint has an online chat team that is available weekdays from 9 a.m. to 7 p.m. Eastern.
- Cost: $79.99/mo - $129.99/mo with a $99.00 or $195.00 initial working fee, depending on the plan.
- Where to find: Credit Saint
Read a full review of Credit Saint.
Lexington Law Firm
Lexington Law Firm helps clients repair their credit scores by negotiating. The firm offers services that address credit repair and credit building. The firm distinguishes credit repair as addressing past information, such as incorrect and unfair negative items. It defines credit building as activities you can do in the present to improve your credit score, such as making on-time payments.
The firm will review your credit report and ask the credit bureaus to make any necessary changes. Lexington Law continues to monitor your credit and address any issues by leveraging the law.
Lexington Law gets prospects started with a free online credit assessment, a free credit score, a free credit report summary, and a free credit repair recommendation. The firm has helped clients repair their credit for 19 years. The lowest plan starts at $95.95 monthly, and the highest plan reaches $139.95 monthly.
- Cost: $95.95/mo - $139.95/mo, depending on the plan.
- Where to find: Lexington Law Firm
Noble Credit Consulting
Noble Credit Consulting offers credit repair services for individual consumers and couples. The company offers free consultations to help you get started. You can communicate with customer support via email or phone.
The company is based in Texas and was launched in May 2022. It has a $125 startup fee for its plans. The individual plan is $99.95/mo while the couples service plan costs $179.95/mo.
Noble Credit Consulting lays out its refund terms. The company has to do a sufficient job to earn money, such as removing more than 25% of the inaccurate negative items on your credit report. The agency has to fulfill its obligations to earn the money you provide.
Noble Credit Consulting lists many financial products and offers that can improve your credit, such as credit builder loans and secured credit cards. If you want access to these financial products, Noble Credit Consulting can help.
- Cost: $99.95/mo - $179.95/mo, depending on the plan. Each plan has a $125 startup fee.
- Where to find: Noble Credit Consulting
The Credit People
The Credit People has been helping clients repair their credit reports for nearly 20 years. The company offers free consultations to get you on the right path and speak with credit bureaus on your behalf.
The company's credit repair team works on disputes and letters to the bureaus. The Credit People has processed over 310,000 credit reports and has experience with credit repair laws. The team has requirements for ongoing education to stay updated with the latest credit repair laws.
Consumers can choose from two plans: Standard and Premium. The Standard Plan includes unlimited challenges to all three credit bureaus and "Before & After" credit score analyses. This plan costs $79 per month. The Premium Plan includes escalated disputes and validations, creditor interventions, and monthly updates on your credit report and score. This plan costs $99 per month.
Clients can also opt for the Premium Flat Rate plan, which costs $499 for six months. This plan allows you to get a free month of the Premium Plan by committing to more months. It's optimal for people whose credit repair process involves a long-term approach rather than a few quick fixes.
- Cost: $79/mo - $99/mo depending on the plan, plus a $19 fee.
- Where to find: The Credit People
Credit Versio
Credit Versio takes a different approach with credit repair services. While other companies offer to help you with the process, Credit Versio allows consumers to take a more affordable approach. This software guides you to repair your credit score instead of relying on professionals.
Credit Versio has educational credit coaching resources along with a customer support team. The company's lowest plan is $19.95/mo, with unlimited credit disputes and monthly credit bureau reports. The Basic Plan only offers two monthly TransUnion Reports and score updates, while the Premium Plan offers unlimited reports and score updates. The Premium Plan costs $29.95/mo.
Credit Versio uses artificial intelligence to create dispute responses for inaccurate negative items on your score. Each negative item has a different dispute strategy, and Credit Versio provides what you need.
- Cost: $19.95/mo - $29.95 depending on the plan.
- Where to find: Credit Versio
The Credit Pros
The Credit Pros helps people regain their feet and identify their most damaging and helpful credit items. The company can file disputes and negotiate with the credit bureaus to remove inaccurate items on your report.
The Credit Pros also take steps to assist consumers with the credit-building process. The company provides credit education tools that can lead to higher scores. The Credit Pros begins by providing prospects with a free assessment of their Equifax credit report. You can set up a free consultation with the company to learn more about your options.
The Credit Pros has a 90-day money-back guarantee and a $5,000 tradeline that lets you make purchases and build credit. This activity can improve your payment history, which makes up 35% of your credit score. The company also has a credit builder program available.
The Credit Pros has three plans that are $69/mo, $129/mo, and $149/mo. These plans have first work fees of $119, $129, and $149, respectively. The Money Management Plan is the least expensive and is more affordable than most credit repair agencies.
The credit repair company only files disputes with one credit bureau for this plan. If the disputes are successful, the bureau will notify the other two, resulting in changes across the board. The other two plans result in challenges for all three credit bureaus.
- Cost: $69/mo - $149/mo, depending on the plan. The first work fee ranges from $119 to $149, depending on the plan.
- Where to find: The Credit Pros
FAQs
How much does credit repair cost?
Credit repair costs vary for each company, but most companies charge close to $100/mo for their credit repair services. In most cases, clients will also have to pay an initial fee.
Can a credit repair agency fix a bad credit score?
A credit repair agency can improve a bad credit score if inaccurate items are on your credit report. The bulk of credit score growth comes from credit-building strategies, such as paying off debt on time.
How fast can a credit repair company fix credit?
You can see notable improvements in your credit score in as little as three months. However, results vary since each credit report is different.
Do banks offer credit repairs?
Most banks focus on credit-building resources, such as a credit builder loan or a secured credit card. There aren't as many banks that offer credit repair services.
Are credit repair agencies legitimate?
Credit repair agencies can save you plenty of time by contacting the major credit bureaus and resolving any inaccurate items on your credit report. They are legitimate companies, and some have A ratings from the Better Business Bureau.
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- TurboDebt has a Trustpilot rating of 5/5 based on 1288 reviews
- Subject to qualification and approval. $1,500 monthly income required.
- Apply in 5 minutes. If you qualify, chat online with a friendly online debt representative.
The bottom line
In the pursuit of credit repair, it's important to remember that there's no one-size-fits-all solution. The best approach often involves a combination of strategies, including responsible financial management, timely bill payments, and monitoring your credit reports for accuracy. Whether you choose to take the DIY route or enlist the help of a reputable credit repair company, patience and persistence are your greatest allies. Building or rebuilding your credit is a journey that requires commitment, but the rewards—such as better loan terms, lower interest rates, and improved financial freedom—are well worth the effort. By making informed choices and staying dedicated to your credit goals, you can pave the way to a brighter financial future.
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Writer
Marc Guberti is a business freelance writer who specializes in personal finance, digital marketing, and entrepreneurship. His award-winning book "Content Marketing Secrets" teaches readers how to create, promote and optimize content for growth and revenue. Marc also hosts the "Breakthrough Success Podcast," where listeners learn how to master content marketing and get more clients.
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