Personal Credit Repair: What is Repaired, Time Required, Avoid Scam & more

Credit Repair in USA

Having a positive credit history on a personal level is very important and even more so for business owners. However, most people don’t realize how fundamental this issue is in countries like the United States.

This article explains what personal credit is and how to repair it; if there is a negative history.

Personal Credit Report

To begin with, you must understand that the personal credit report is the description of your financial movement through the years and that it is qualified with a scale of scores. With this credit history, a lender will be able to tell whether or not you are a eligible for a credit (credit card / home loan / personal loan / car loan etc.).

When a person has less than 700 points, lenders consider them risky and that there is a high probability that they will not pay their debts on time. And, in general, they grant them credit, but with higher interest rates. Even insurers take this history into account when setting premiums.

How is credit history calculated?

It is divided into five parts:

  1. Payment history (paying off debts on time, this represents 35% of the score),
  2. Amount owed (30%)
  3. Age of credit (if a person closes a card that he/she used for a long time, this lowers the score)
  4. New credit and
  5. Types of credit (credit cards, car loans, among others).

Correctly closing a credit card

If a person no longer wants to use a credit card and wants to close it without affecting his history, he should stop using it, leave it at zero and after six months the issuing bank, when it sees that there is no movement, sends a letter indicating that the account will be closed. This hurts your credit.

Now, other parameters must also be analyzed. If you have a card that was given to you 20 years ago, for example, it is not advisable to close it because it is a long time of credit history.

For people to reach 850 points in a registry, they must have at least 20 years of history. That is why the age of the credit is important.

What does credit repair consist of?

Basically it is the opportunity to repair credit that has been damaged by ignorance or because user has problems with payments.

The first thing that must be done is an analysis of the credit report. This is done to determine which are the negative accounts and prepare the so-called dispute letters that are sent to the credit bureaus, so that they begin an investigation of the negative accounts.

If everything goes in the client’s favor, the bureaus will erase the negative accounts, which positively impacts the credit score.

This mechanism is covered by the Fair Credit Law. The regulation allows consumers to request that all negative or inaccurate items that are impacting their credit be investigated.

In fact, it is estimated that there are significant number of individuals with legitimate errors in their credit history in the United States. There are consumers who have never made a late payment or taken actions that hurt their credit, but are affected by inaccurate data or information.

Common errors have been found to be inaccuracies in names or addresses, confusion on accounts, late reporting of payments that were made on time.

What can be repaired?

Anything negative on a credit report is repairable. Car loan, credit cards, student accounts, utility bill payments, etc.

But be careful, just because the negative information is removed does not mean that the debt ceases to exist, if it is legitimate.

There are issues such as bankruptcies that are generally said to be present on the credit record for twenty years and will have a negative impact for seven years.

However, it is possible to work so that the bankruptcy does not hurt the credit record for seven years. There are formulas to dispute the separate bankruptcy items to the point that they can be removed from the credit record and increase the score.


Now, it must be understood that credit does not “hold a grudge” so new positive accounts must be created to improve the record.

Currently there are many tools for anyone with negative numbers to start building positive credit.

What is the time required to repair credit?

Each case is different. There are people who with the first dispute letter submitted have had negative accounts deleted from all credit bureaus. But there are others who only have negative information deleted from one bureau. It all depends on each case.

Positive responses to the first dispute letters may arrive between 45 and 60 days, although there are cases in which this time can be extended to six, nine months or a year.

You should also be clear that repair is not the same as a credit score. While you can increase your score through credit repair, you must continue good payment habits, build positive credit history and not over-indebt yourself.

How do you avoid credit repair scams?

There are many companies or people who promise you to reach a certain score and achieve it in a specific time and charge a high commission. But you should be careful with such companies.

Remember that, in order to get a credit repair they must provide sensitive information such as your social security number. So it is essential that you previously investigate the history of the company or professionals you are turning to for help.

You should make sure that the company has a structured website and mobile applications where you can observe all the movements they are making.

Read: How to repair credit in USA

Where to see the credit reports?

If you want to see it for free, once a year, you can go to

Now, if you need more advice, since the information you have is not very friendly and easy to understand, you can go to companies that are dedicated to analyze this data and help users to improve the history.

There are people who have ITIN number (IRS personal taxpayer identification number) and who also have credit history because they have lived many years in the United States. But it is very difficult for them to get their history on websites such as

They must go to specialized companies so that they can obtain the report and analyze their negative accounts to repair their credit.

Author Bio:

I am Nikesh Mehta, owner and writer of this site.

Nikesh Mehta - Image

I’m an analytics and digital marketing professional and also love writing on finance and technology industry during my spare time. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business. I can be reached at [email protected] or LinkedIn profile.

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