There are a number of companies offering rapid credit repair or even a brand new credit report, but neither of these are genuinely possible. Credit repair is a multi-million dollar business. The reality is that the majority of problems can be corrected gradually without any external help.
New Credit Reports are Not Legal
Credit score ratings are in-place to assess the borrowers suitability for credit. If someone represents a high risk, the lender should be free to decide whether they wish to offer that person a loan. The attainment of credit under false pretences constitutes fraud and is punishable by imprisonment.
The Misnomer of Rapid Credit Repair
Raising FICO scores through reliable repayment can take many months to achieve. For example, filing for chapter 7 bankruptcy will show on a credit report for a period of 10 years. The period it will show for is seven years in the case of chapter 13 bankruptcy.
Raising FICO Scores
It is possible to increase credit score ratings by making reliable repayment when borrowing cheaper. Provided that repayment is maintained, scores will start to improve in as little as seven to eight months. It is even possible to recover from bankruptcy within a couple of years of discharge.
Those who don’t have any active credit agreements may wish to sign-up to a bad credit unsecured credit card. Reliable repayment (or otherwise) will be reported to the three leading credit reference agencies (Experian, Equifax and TransUnion).
Improve Credit Score Results by Getting Errors Corrected
The Consumer Data Industry Association (a trade group representing credit reference agencies) stated that up to 3% of all credit reports have data entry errors in them. Errors will clearly have a negative impact on credit score ratings and the chance of a successful application for credit.
Under the Fair Credit Reporting Act 1970, the onus is on the borrower to correct any errors through the credit reference agency and not the lender. The exception to this rule is credit cards. Don’t waste time writing to the lender.
Whilst one would assume that rapid credit repair was possible when a simple data entry error was the problem, this isn’t necessarily the case. It can take many months to get an error corrected. It can take a lot longer if the appropriate supporting evidence isn’t provided.
Rapid credit repair is not possible. This means that, those who plan to apply for the latest mortgage deal or best balance transfer credit card, need to start working on their FICO credit score many months in advance. Don’t leave credit repair until the last minute.