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Help Your Credit – DIY Credit Repair

Is your credit score helping or hurting you? When it comes to your credit score, bigger is better. Lower credit scores translate to higher interest rates, less appealing qualified offers, and even missed opportunities. The good news is, there are steps you can take on your own to repair your credit and improve your score.

Face the Facts. The first step is to request free copies of your credit reports. You are entitled to receive one free report annually from each of the three major credit bureaus: Experian, Equifax, and Trans-Union. Visit to order your free reports. Once you have them, closely review and compare them for accuracy. (Please note: these free reports do not include your credit score. There are ad-supported websites such as that allow you to obtain your free credit score, but be sure to read the sites’ terms and conditions first.)

Fight the Errors. Dispute all incorrect information you find on your reports. Start by looking for discrepancies in your name, Social Security Number, addresses, etc., and then tackle your credit history. Make sure you recognize all accounts listed as yours, that your payment history is accurate, and that open/closed accounts are correct. If you find any errors, contact that reporting agency directly by sending a letter via certified mail that specifies the error(s) along with your explanation and any documents to support your claims.

Plan and Prioritize. Now that you know where you stand, it’s time to create your plan. Start by developing a budget that allows you to pay your current obligations on time each month. Paying on time is the quickest way to move your credit score needle in the right direction. Next, prioritize your obligations. Are you going to pay off your smallest balances or your highest interest rate balances first? The first approach may offer better motivation, but the latter will save you more money in the long-run. The approach is up to you; the key is choosing a plan of attack and sticking to it!

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Know Your Limits. Pay attention to your credit limits and try to stay well under your maximum. Debt is evaluated in terms of ratios: if you owe $500 on a card with a $2,000 limit, you’ve used 25%, which is better for your score than owing the same amount on a card with a $1,000 limit (50%), both of which are better than being “maxed out” at 100%. Pay your credit cards down, but don’t cancel them. The total amount of your available credit helps your score, even if your balance is zero.

Keep Inquiries to a Minimum. Avoid temptations to open new credit cards just for discounts. Each time you apply for credit it’s recorded as a “hard inquiry” on your report; too many within a 2-year period can hurt your credit score. However, “soft inquiries,” which include checking your own credit, do not count against you.

Once you’ve taken the steps above, the hardest part is being patient. Depending on your situation, it can take months or even a year or more for your credit score to improve substantially. However if your plans include a new home or starting your own business, the time and effort is worth the wait!

This article by Wayne J. Delk first appeared on Fort Madison Daily Democrat and was distributed by the Personal Finance Syndication Network.

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