Credit repair is a great way to boost your SMARTScore. How so? Your SMARTScore is based on a number of factors, including whether you pay bills on a timely basis. Missing payments can hurt your score and, in turn, make it more difficult for you to obtain other credit, such as a mortgage or car loan, in the future. A poor SMARTScore can also mean having to pay higher rates, and limited options on other forms of credit.
All of this information that make up your SMARTScores are calculated based on the information in the your credit report, and sometimes that information is inaccurate. That can happen when creditors report inaccurate information to the credit bureau or if an identity thief takes out credit in your name. This is why credit repair is important – it is the process of trying to correct inaccurate information on your credit report that influences your SMARTScore negatively. However, if you are new to the concept, here is a guide to 5 frequently asked questions about it.
Credit repair is a term used to describe the improvement of an individual’s credit report. This is achieved by reviewing your credit report and investigating negative listings that may be affecting your credit score. Credit repair involves attempting to have negative listings removed from your credit report.
No. Credit repair is a legal way to improve a damaged credit history and raise your credit score. You can hire a professional firm to help you repair your credit, but it won't be able to do anything for you that you can't do for yourself.
These are third-party companies that offer to address errors that could be hurting your score for a fee, but you can do the same things for free. Note that credit repair can’t do anything that you can't do on your own, and it can't remove negative marks from your credit reports if they're accurate, timely and verifiable.
Ultimately, credit repair companies communicate on your behalf either with the credit bureaus or with the companies that reported or "furnished" your credit information to the bureaus. These data furnishers are almost always debt collectors or financial services companies, like banks and credit card issuers. The intent is to have the credit bureaus or furnishers either delete the credit information altogether or modify it in some way that's more favorable to the consumer.
Whether you’re repairing your own credit or paying a company to do it for you, it's smart to have a plan for building and maintaining your credit going forward.