Technically, credit repair can involve fixing your bad credit in any way, shape or form, but when most people use the term, they’re referring to the process of disputing errors on credit reports. You can go through this dispute process for free with each of the credit bureaus on your own. This involves filing a formal dispute with the credit bureau(s) in question either online or via snail mail. That formal dispute should provide a detailed explanation of the error and you’ll want to include any supporting documentation you have along with it. (You can learn more about disputing errors on your credit report here.)
Many people, however, don’t have the time or don’t understand how to make their case, so they look into hiring a credit repair company to dispute errors on
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(Source: Paul Ritter)
their behalf. These companies can charge a fee for their legwork (more on how that works in a minute), but there are times when the extra help can certainly be welcome. (Say you have multiple errors across credit reports or you’ve been the victim of widespread identity theft.) We’ll delve deeper into both types of credit repair, starting with credit repair businesses, since there’s a good chance that’s what someone is referring to when they use the term.