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Credit Info Center's Credit Repair FAQs

Last Updated: February 17, 2017

Whether bad credit is new to you or you’ve been living with it for years, it’s never too early (or too late) to do something about it. Unfortunately, credit repair can be a confusing process. Can you really repair your credit on your own, or should you hire someone to do it for you? And either way, how does credit repair work? Below are answers to these and other commonly asked questions to help you navigate the process every step of the way.

Bad Credit

Credit Repair Process

Credit Repair Companies

What's bad credit?

Bad credit is a record of negative credit history. It’s typically characterized by negative listings in credit reports and low credit scores generated by those reports. Anything under 600 is generally considered bad. This is based on a credit score range for which 850 ranks the highest and 300 ranks the lowest (for FICO and VantageScore 3.0 models). Back to Top

What causes bad credit?

Negative listings in credit reports cause bad credit. These include late payments, collections, charge-offs, foreclosures, liens, judgments, and bankruptcies. Identity theft can also cause bad credit when thieves open new credit accounts in your name or make charges to existing accounts. Until you get identity theft sorted out, you may have bad credit stemming from these unpaid debts. Back to Top

How does bad credit affect you?

Bad credit can result in:

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How can bad credit affect employment?

Many employers look at credit reports when making hiring decisions. Some run credit checks on all job applicants, but most employers limit their credit checks to certain positions. For instance, if the job requires the handling of money or access to personal information, a credit check is likely. In any case, however, your written permission is required first. Back to Top

When does bad credit go away?

There are a few circumstances in which bad credit goes away:

1) Negative listings naturally fall off your credit reports – most after 7 years, bankruptcies after 10

2) Negative listings may be removed after disputing errors on your credit reports

3) Collections may be removed via debt validation or the pay for delete method

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What is credit repair?

Credit repair is the process of improving your credit. This is accomplished by 1) addressing negative listings on your credit reports and 2) building positive credit history. Though you can pay a credit repair company do it for you, repairing your credit is something you can do on your own for free using our DIY credit repair guide. Back to Top

How does credit repair work?

The credit repair process includes:

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How long does the credit repair process take?

If you have errors on your credit reports that can be successfully disputed, you could see improvement in your credit in under 6 months. To the other extreme, if you have negative listings that are not in error and a lot of debt to pay off, credit repair could take years. It takes as long as it takes. Back to Top

Who can help with credit repair?

You can help yourself with credit repair or hire a credit repair company to do it for you. If you choose DIY credit repair (which we recommend you try first), refer to our free credit repair guide and forum. If you’re considering a credit repair company, find out what a legitimate credit repair company looks like. Back to Top

Who can fix my credit report?

Though the credit repair process starts with you, it is the credit bureaus that ultimately make changes to your credit reports. So if you find an error in one of your credit reports, the first step is to send a credit dispute to the appropriate credit bureau (via regular mail with return receipt requested). Back to Top

Who can I contact to fix my credit?

If you’re repairing your own credit, contact:

If you’d rather pay someone to fix your credit, you should contact a legitimate credit repair company. Back to Top

Can I repair my own credit?

Absolutely. There is nothing a credit repair company can do for you that you cannot do for yourself, for free – from disputing listings on your credit reports, to requesting debt validation from collectors, to the settling of old debts. Our DIY credit repair guide will walk you through the process every step of the way. Back to Top

How do credit bureaus investigate disputes?

When a credit bureau receives a dispute, they forward it to the data furnisher that provided the disputed information. The data furnisher is asked to verify its accuracy. If verified, the disputed item remains unchanged. If unverified, the credit bureau should correct it. For more details, here’s how the bureaus describes their dispute process: TransUnion, Experian, Equifax. Back to Top

How long do credit disputes take?

Once a credit bureau receives a credit dispute, they have 30 to 45 days to respond. If your dispute is successful, it should be corrected immediately. If it is not corrected and you receive no response, you may send a follow-up letter. If the correction is denied, you may dispute directly with the original creditor or collector. Back to Top

What is debt validation?

When you receive the initial communication from a collector trying to collect an unpaid debt from you, you have the right to request proof of the debt (provided you do so within 30 days of the initial communication). This is called debt validation. Unless they validate the debt, the collector cannot continue collection attempts. Back to Top

What constitutes debt validation?

A debt validation letter from a collector should include:

The more times this debt has been sold over the years, the less likely the collector can fulfill all of these requirements. Back to Top

What are credit repair companies?

Credit repair companies get paid to help consumers clean up their credit. What they can and cannot do is determined by the Credit Repair Organizations Act. While there are legitimate credit repair companies that follow these rules, there are many violators, which is why it is so important for you to watch out for red flags. Back to Top

When was the Credit Repair Organizations Act enacted?

The Credit Repair Organizations Act (CROA) was signed into law in 1996. The CROA prohibits credit repair companies from:

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Are credit repair companies any good?

As with any industry, the quality of credit repair companies depends on which one you’re working with. Best case scenario, the company you hire has qualified staff who have an in-depth understanding of credit repair techniques. Worst case scenario, the company has no clue what it’s doing and, in fact, ends up doing nothing at all. Back to Top

Which credit repair company is best?

Though we encourage consumers to try DIY credit repair first, if you’re thinking about hiring a credit repair company, we recommend Lexington Law:

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What are credit repair services?

If you hire a credit repair company, the services they provide are similar to the techniques you would use if you were to repair your credit yourself:

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How do credit repair services work?

By law, credit repair companies can only collect fees from you for work that has already been completed. This means any credit repair company that wants to charge upfront fees – before doing any work for you – should be avoided. Note, though, it’s common to be charged an initial fee followed by a regular monthly fee for ongoing service. Back to Top

Are credit repair services legitimate?

It depends on the credit repair company. Unfortunately, there are plenty of scammers out there. It’s probably not legitimate if they:

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Are credit repair services worth it?

It is only worth paying for credit repair services if all the following are true:

Didn’t find the answer to your question here? Ask in our free, friendly credit repair forum. Back to Top

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