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How Does Credit Repair Work? How to Repair Credit a 3-Step Process You Can Understand

Despite not having the knowledge that is necessary to understand the financial services sector or how to implement personal financial management tools many people still feel ashamed when they have some financial stumbles that could have been prevented.

Thinking about one’s finances or the state of one’s bank account can be a daunting prospect for many people. Arguably our culture has a very strange relationship to personal finance. Everyone needs to make money and to know how to manage it well but very few people are taught by their families or other entities how exactly to go about effectively manage the money that they earn.  According to the business publication Fortune Magazine, nearly 60 percent of Americans are not able to pass a basic financial literacy test. Most people are not knowledgeable about how the financial system works or how to best go about managing and organizing their financial lives.

Increase Your Financial Knowledge

While financial literacy seems to be an elusive concept for many people it is an attribute that is key to living one’s life in the United States. Being financially literate gives people the tools that they need in order to understand and build up their credit to the level that they want it to beat. Bringing up the subject of bad or low credit can be an uncomfortable one that has ever struggled to gain their financial footing.Having good credit can be an attribute that can open many doors while having bad credit can make life harder than it needs to be. Having a credit score that is lower than one would like can be a source of unnecessary shame. For some people, it likely takes them back to the days of being a student in grade school and feeling the embarrassment of receiving a low grade on a test from their teacher. Some people might feel as though the state of their credit is a kind of grade point average that measures their performance as an adult and if they have credit that is lower than they would prefer for it to be then this means that they have somehow failed as an adult.

Your Credit Score is Not Who You Are

The good news is that no one should treat the state of their credit as though it is a barometer for their self-worth or their success in life. The state of a person’s credit report simply represents how an individual has managed their credit in the past. The best thing to remember is that no matter how high or low a person’s credit is, it is never written in stone.Credit is something that is always that is always a work in progress. It is important to remember that no matter how low a person’s credit is it can always be raised. But what is important to know is that low credit will not be changed overnight. Low credit can be changed through engaging in a process to repair credit.

Credit Repair Process

Credit repair simply refers to the process of increasing your credit score to benefit from financial security. The process of repairing one’s credit and raising a credit score to a higher number is a rather simple one. The process of repairing one’s credit can be a very simple undertaking that involves three easy steps. Individuals who are interested in credit repair can initiate the process by:

  • Retrieving Your Credit Report

Requesting copies of their credit reports from each of the three credit reporting agencies. These agencies include Equifax, TransUnion and Experian. It is necessary to request a credit report from each of the credit reporting agencies because they can each report different information. If a consumer wants the full picture of their credit they will not necessarily be able to obtain that by merely looking at the information provided for them by one credit reporting agency. Having access to all three credit reports will allow a consumer to have a holistic picture of their credit report. Consumers can also check their credit scores by creating an account on the website CreditKarma.com

  • Review Accurately and in Detail

When a consumer has all three copies of their credit report it allows them the ability to look through these credit reports and make sure that the information contained in each of the credit reports is actually accurate. This is important because if there is incorrect information on a credit report this can unnecessarily lower a consumer’s credit through no effort of their own. Having low credit can result in a consumer being faced with the prospect of having to pay higher deposits on properties that they rent or not being able to rent the apartment of their choice in the event that their credit is too low for a particular property. Low credit can lower the housing or financing options that are available to a consumer.

  • Dispute any Errors on Your Credit Report

The last step is to formally dispute any errors that have been discovered on one’s credit report. An individual can dispute mistakes on their credit report by writing a letter to the credit reporting agencies that describes the mistakes and provides proof of each mistake. It is important to remember that there are always many options available when one is trying to remedy bad credit.