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You probably hear the term “credit repair” bandied around all the time, and it sounds very difficult to do. However, it doesn’t have to be that hard, and in fact, you can do yourself.

Here are seven of the most common myths about credit repair. Let’s talk about them in some detail.

Myth number one: If I declare bankruptcy, my credit report will be set to “zero,” and I’ll have a clean slate.

In fact, that’s not true. When you file for bankruptcy, every credit account that is included in the bankruptcy will be marked as such. In addition, a bankruptcy filing and bankruptcy discharge listing will appear in the in your credit report. Because there are so many negative items in your bankruptcy, you’ll not be able to remove all traces of the bankruptcy, and it will remain on your record for 7 to 10 years. If at all possible, bankruptcy is to be avoided. It’s not something you want. If you need it, it should be done as a last resort.

Myth number two: Some negative listings, such as foreclosures and bankruptcies, can never be removed from your credit report.

In fact, even these types of negative listings eventually are removed from your credit report. Yes, they’ll need to stay on your credit report for a certain amount of time, such as the 7 to 10 year time limit most often used. But eventually, these, too, “fall off of” your credit report and don’t show up any more in your financial history.

Another type of negative credit listing that is often difficult to remove are tax liens, as well as tax judgments.

Myth number three: If I pay off “past-due” accounts, including those that have gone to collection, it will show up as “paid,” and will no longer be a negative listing on my credit report.

As with any other type of outstanding debt, you can’t simply correct your credit report by number one, ignoring it, or even number two, by simply paying it off. Yes, the listing will show as “paid” on your credit report, but it will still be there to show that you had financial difficulty. It may say something like, “Paid to collection,” or something similar. This is still a negative credit listing; however, it’s much more positive than simply having it be outstanding, because it shows that you were responsible enough to actually pay it.

In fact, there are cases when paying off debt can actually be a disadvantage to you. In some cases, paying off a charged off debt is one of these times. These types of collections can stay in your credit report for a maximum of seven years. Therefore, if you have outstanding debt, and it’s over seven years old, your best bet is to just leave them alone in some cases. If you have any questions, seek professional credit counseling and determine what you should do. They can help you decide what the best course of action is.

Myth number four: if I work on building good credit, it will “repair” my bad credit and make me a good risk again.

In fact, this is true to some extent. As you continue to exhibit responsible behavior, your good credit is going to offset your bad credit to the point where it’s going to affect you much less after you’ve worked on building good credit for a couple of years. It will still be there for seven years or whatever the time limit is, but you’ll still be doing a lot to repair your credit report if you clean up your own financial behavior and begin to act responsibly. However, even one late payment can negatively affect you, so make sure you pay everything on time. If you do this, you’ll have much better chances of getting approval on things like credit cards or even mortgage loans.

Myth number five: Even if I can delete a negative item that’s on my credit report, it will just come right back.

In fact, this can be true. You are responsible for your own debts, and these will stay on your credit report. There is no way you can delete accurate negative credit information from your credit report. What you can do is dispute items you think are inaccurate or incomplete. These the credit agency must investigate within 30 to 60 days and if they are not found to be true or if the creditor in question does not respond, they must be removed. Therefore, the bottom line is that you cannot delete accurate negative information. However, you can delete or adjust information that is not accurate or that is incomplete. And the creditor has the right to verify negative information, so if he or she misses the 30 to 60 day deadline and that information is removed, it can be put back if in fact it is verified later.

Myth number six: Requests or inquiries cannot hurt my credit score.

Well, that depends. If the inquiry comes as a result of your application for a credit card, etc., and the creditor accesses your credit report, this can hurt you. If the inquiry into your credit report does not have anything to do with action by you that’s going to affect your credit score, in general, it does not hurt your credit score.

Myth number seven: It’s too hard for me to repair my own credit report. I should hire an attorney.

In fact, an attorney is not going to be able to “repair” your credit. You are going to be able to “repair” your credit only by exhibiting responsible financial behavior over time so that eventually, your good credit history outpaces your bad credit history and leaves it behind.

If you need help to sort out a lot of information that’s inaccurate, or that you think is unfair, an attorney may be able to help you. However, again, accurate negative information can only be removed by time and by good behavior. That is really up to you, and doesn’t require the services of an attorney or any other professional to make it happen. Again, an attorney or other professional may be of assistance to you if your credit report is a great snarl that needs to be sorted out. In that case, he or she can help you figure out what’s yours and what’s not, and get erroneous information removed.

In fact, a bad credit report that is not your fault is going to cost you a lot of money it shouldn’t. In this case, if there’s a lot of error on your credit report, you need to remove that so that your credit scores improve instantly. Otherwise, simply engaging in good responsible behavior, checking your credit report regularly to make sure you’re not a victim of identity theft or something else (and to make sure that the information on it is still accurate), and addressing your debt so that you can pay it off and leave it behind is the only way to actually repair your credit. There is no other way.

There’s a lot of good information out there, including good e-books, that can help you figure out the process. You can simply find these by doing a search engine keyword search.

Troy Nantais is a credit professional with over 20 years experience in the field. His website www.bad-credit-home-loan.net provides advice and information on credit repair, and fixing bad credit as well as advising people how to avoid foreclosure.

Article Author :Troy_Nantais

Tags: mortgage loan, credit score, tax, bad credit, cards

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