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what is credit repair

Credit Repair: What is it, and is it worth doing?

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Credit repair, broadly speaking, is the act of improving your credit score by seeking to have incorrect information and errors removed from your credit report. There are a number of errors that can appear on a person’s credit report, and these errors can have a drastic effect on your credit score.

Some of the more common errors are:

  • An account that was paid in full showing that the consumer still owes.
  • The creditor issues a 1099-c to the consumer, but the credit report shows that the consumer still owes.
  • The account was sold to a different creditor but is still showing as owed to the original creditor.
  • The consumer is listed as owing the same money to the same creditor twice.

Credit repair, broadly speaking, is the act of improving your credit score by seeking to have incorrect information and errors removed from your credit report. There are a number of errors that can appear on a person’s credit report, and these errors can have a drastic effect on your credit score.

These errors can drag your credit score down. If you have multiple errors, your credit score could be 100 points or more lower than where it truly should be. Any of these errors on your credit report could end up costing you tens of thousands of dollars due to you receiving higher interest rates on things like car loans, mortgages, and credit cards as a result of your lower credit score. A simple way to avoid this problem or to fix the errors causing this damage is through credit repair.

Under the Fair Credit Reporting Act (the FCRA) you are legally protected from having incorrect information reporting on your credit report. The FCRA cannot stop the errors from initially being reported but it ensures that, once properly disputed, the errors do not stay on your credit report.

If a person feels that they have an error on their credit report they must send a letter disputing the error to the creditor and to the credit reporting agency that is showing the error on the credit report. It is best to include some type of evidence with your dispute, whatever is required to show that the error is in fact an error. The creditor and the credit reporting agency will then investigate the error and either remove the error, or determine that the trade line is not an error and continue to report it. Sometimes, even after properly disputing the error, a credit reporting agency will fail to remove something that is in fact an error.

If a first dispute does not remove the error from your credit report, you have two options. One option is to re-dispute the error, and to consider including more evidence with your dispute. A second option is to hire an attorney to file an FCRA lawsuit against the creditor and the credit reporting agency. The FCRA not only provides you with the right to sue the creditor, but with statutory damages owed to you by the creditor and the credit reporting agency as wells as your attorney’s fees. That means that if disputing the error does not work to get it removed, an FCRA lawsuit could get the error removed and put some money in your pocket all at no cost to you.

If you have tried disputing an error on your credit report and it was not removed, give us a call at (855)-976-5777 for a free consultation to see how we can help you. You can also fill out this form to have an attorney help correct errors in your credit report at no cost to you.

Credit Repair: What is it, and is it worth doing? was last modified: September 27th, 2016 by Kevin Fallon McCarthy
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Kevin Fallon McCarthy is the McCarthy Law PLC’s managing attorney and an experienced Phoenix debt attorney. Mr. McCarthy has also worked as general counsel for a large corporation. He has corporate counsel experience in human resource matters, general corporate governance, and union class action litigation.
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