First, it’s important to understand what credit repair really is and how long it will last.
Before you move on to filtering the results of your search for credit repair companies in Houston, there are a few credit repair basics that you need to be acquainted with. Consumers looking for credit repair services often have a number of questions such as, can a credit repair company raise my credit score, and how much does credit cleaning cost?
Consumer credit scores depend on a number of factors, including whether the person pays their bills on time. Credit scores are calculated based on the information in the consumer credit report, and sometimes this information is inaccurate. This can happen if the creditor’s report provides erroneous information to the credit bureau or if an identity thief takes out credit in the consumer’s name.
Credit repair is the process of correcting any such inaccurate information in your credit report with the intent of raising your credit score. The Fair Credit Reporting Act (FRCA) gives every individual the right to dispute any inaccurate information on their credit report.
Unfortunately, there is no specific timeline that the credit repair process follows. It could take anywhere from thirty days to one year or more, depending on how serious the credit issues are and how the credit history was affected. The length of time for credit repair also depends on how long the negative items have been on the credit report.
Negative payment information can remain on your credit report for seven years, although bankruptcies can stay on a credit report for ten years, depending on the type of bankruptcy filed. The FRCA explains the limits on reporting the different kinds of damaging marks, though some of these limits also vary according to state laws. Here’s how long incidents of negative credit history remain on consumer reports from the date they are filed, as mandated by the FRCA:
Late payments: seven years
Charge offs: seven years
Foreclosures and short sales: seven years
Hard enquiries: two years
Collection accounts: seven and a half years
Chapter 7 bankruptcies: ten years
Chapter 13 bankruptcies: seven years
Negative information tends to affect your credit score less as time goes on, but serious delinquencies, such as charge-offs or collections, are harder to recover from than one or two missed payments. However, there are ways to begin the process of credit repair sooner rather than later.
If you want to start rehabilitating your credit, you need to start by getting your credit report from each of the three major credit bureaus—Experian, TransUnion and Equifax. While reviewing your credit reports, keep the following in mind:
Pay attention to your payment history–your payment history is the single most important factor that determines your creditworthiness.
Keep track of your credit utilization rate–the utilization rate is calculated by adding up the total of your credit card balances and dividing them by the total of all your credit card limits.
While you can take actions to keep your credit score trajectory moving upwards, credit repair usually involves a detailed review of your credit report to identify inaccuracies in the information it contains. These inaccuracies are then addressed by disputing them and requesting their removal from your credit report.
Although you can go with the do-it-yourself approach for credit repair, there are legitimate credit repair companies–such as The Phenix Group, right here in Houston–that will do all the heavy lifting for you. These companies can check your credit reports for information that shouldn't be there and dispute it on your behalf. Credit repair companies dispute the inaccurate negative items in your credit report with the intent of removing them from the report altogether. In addition, they also offer services such as credit monitoring to make sure your credit score keeps improving as you go. -
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