The do’s and don’ts of credit repair

Looking for ways to improve an unfavorable credit score? Here are the do’s and don’ts for credit repair.

Do: Know what is on your credit report
Each of the three major credit reporting agencies are required to provide you with a complimentary copy of your report once a year, upon request. To order yours, visit You’re also entitled to a copy if an adverse action, like a credit application denial, happens — as long as you request it within 60 days of the notice.

Do: Review your report and dispute errors
If you spot an error on your credit report, dispute it in writing. Clearly identify every item you are disputing and the reason. Include copies of documents to support your claim and ask that the errors be corrected. Send it by certified mail and keep a personal copy of your letter for your records. You’ll also want to dispute the charge with your actual creditor.

Do: Take steps toward fixing your credit
If your credit report is accurate, take a careful look at which habits are bringing down your score. Are you constantly late with card payments? Consider setting up automatic bill pay to reduce late payments.

Also, consider debt consolidation or a balance transfer to a card with an interest-free period. You can also contact creditors to try to work out a more reasonable payment plan.After reviewing your finances, you may want to close newer, unused accounts, leaving your oldest cards open. Lots of open, but unused, credit is considered unfavorable by creditors. But, by closing older accounts, you may be erasing valuable credit history.

If your debt isn’t going anywhere, rethink your spending habits. Trim your expenses wherever possible, using all extra cash exclusively for paying down debt

Do: Ask your financial institution for help
Contact your credit union or bank for financial counseling to help you improve your spending and saving habits. These small changes will go a long way toward improving your score.

Don’t: Expect quick fixes
There is no “quick fix” for creditworthiness. If a credit repair company promises to increase your score by 100 points in less than a month, don’t believe it. There are legitimate credit repair companies, but there’s nothing they can do for you that you can’t do on your own! It may take 30 days or more for your account to be updated and your score to improve.

Keep these tips handy as you work to repair your credit.

Article provided by Local Government Federal Credit Union.
The advice provided is for informational purposes only. For additional guidance contact your financial advisor.