DIY Credit Repair 101: A Beginner's Guide to Fixing Your Credit

DIY credit repair means taking steps to fix your credit score on your own, such as disputing errors on your credit report and making timely payments on debts.

A man working on repairing his credit score
Updated May 13, 2024
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DIY credit repair can be a cost-effective method to fix your credit score. This method is based on fixing errors on your credit report, paying off debts, and using your credit cards responsibly.

We break these concepts into seven key steps you can take to fix your credit score. Completing these steps and increasing your credit score could improve your chances of qualifying for a loan or a credit card in the future.

In this DIY credit repair guide

7 tried-and-true steps to repair your credit

DIY credit repair involves identifying the problems with your credit report and taking the right steps to address the issues dragging down your score.

As you address these issues, you can also build positive payment history and take other positive financial behaviors that can further boost your score.

Keeping in mind key credit repair facts, like how to obtain your report, what issues you can fix, and how much time it takes, can help you set the right plan and expectations.

Let’s explore the seven steps you can take to begin fixing your credit score on your own.

1. Get copies of your credit reports

The first step to successful credit repair is obtaining copies of your credit reports. This enables you to look at the information listed and identify items potentially dragging down your score.

The good news is that obtaining copies of your credit reports is easy and free. Visit AnnualCreditReport.com to request a report from the three major credit bureaus. These agencies are:

  • Equifax
  • Experian
  • TransUnion

Normally, you can get one free report from each bureau once a year. However, these agencies began offering one free report per week during the COVID-19 pandemic. You can get these weekly reports until December 2023.

Keep in mind
You can also access one or more of your credit reports via Experian, Credit Karma, Credit Sesame, or other services. Learn more about how to view your free credit report.

Getting your report is as easy as providing basic identifying details, including:

  • Full name
  • Phone number
  • Address and zip code
  • Date of birth
  • Social Security number

You may also need to answer personal questions related to previous addresses you lived at, vehicles you owned, or previous loans you had.

2. Review each credit report

Once you have copies of your credit reports, it's time to dig into the details of each report to find negative items that may be affecting your score.

Factors that determine your credit score include:

  • Payment history and on-time payments: Creditors often look at whether you paid your accounts on time, had late payments, or had accounts go to collection agencies.
  • Average account age: Credit bureaus factor in the average age of your credit accounts when calculating your credit score. Credit bureau may view you more positively as your average credit account age increases.
  • Account types: Creditors often view having a mix of different account types, such as auto loans, credit cards, and mortgages, that are paid on time as a good sign.
  • Previous credit inquiries: Financial institutions often consider your recent credit inquiries. These are marks on your credit report that appear when you apply for housing, financial products, or other services that require a soft credit check or a hard credit pull.
  • Credit utilization: Credit bureaus use the amount of credit you use compared to the total available credit to calculate your credit utilization.

Looking at your credit report enables you to see details on all of these important criteria that go into determining your score. For example, your report should include:

  • A list of your accounts, current balances, and regular on-time payments.
  • A list of inquiries made to your account, including soft credit checks and hard credit inquiries.
  • Public record details, such as court filings related to bankruptcy, foreclosure, repossessions, or legal actions creditors took against you.

You should review each credit report to find negative items such as missed payments. You should also search for inaccurate information, such as incorrect account statuses or accounts you do not recognize.

Learn how to read a credit report and spot errors in it.

3. Dispute inaccuracies with the credit bureaus

While your credit reports should reflect your actual accounts, payment history, inquiries, and more, they could sometimes contain inaccurate details.

This could be because creditors made mistakes in reporting your information. It could also be that someone used your identity to open accounts in your name without your permission.

Find out how you can protect yourself from identity theft.

Whether the inaccurate information results from a simple mistake or identity theft, you can — and should — ask for its removal, so you aren't penalized for errors.

You can dispute inaccuracies with each credit reporting agency. Here is how to file your dispute with each one:

Equifax Experian TransUnion
Online Fill out an online form Fill out an online form Create an account then fill out an online form
Mail Complete and send a dispute form to Equifax Information Services LLC P.O. Box 740256 Atlanta, GA 30348 Fill out and send a dispute form to Experian P.O. Box 4500 Allen, TX 75013 Complete and mail a dispute form to TransUnion Consumer Solutions P.O. Box 2000 Chester, PA 19016
Phone Call 888-378-4329 Call 888-397-3742 Call 800-916-8800

Keep in mind
Alternatively, you can use the sample dispute letter from the Federal Trade Commission (FTC) to file a written dispute via mail. Remember that it can be more convenient to dispute inaccuracies online.

Credit reporting agencies must investigate the disputed information, check with the lender or credit card issuer reporting it, and follow up with you after an investigation.

4. Make payments on late accounts

The next step is to address any late or missed payments you have on your credit cards, loans, or other credit accounts that show up on your credit report.

Late payments can typically lead to a low credit score. The issue can even worsen the longer you wait to address it. That’s why it’s best to act quickly after missing a payment — ideally, before your account is sent to collections or the lender takes legal action against you.

It’s also worth asking if your financial institution is willing to waive the late fee or forgive the missed payment. Some credit card issuers and loan providers may be able to help you.

Note
Making payments on late credit card accounts or loans doesn't have to be the full balance due. Even a partial payment of your credit card debt or loan balance can help fix your credit score.

If you can’t pay off your loan or credit card balance, make sure to pay at least the minimum amount due. This shows creditors that you are making an effort to pay off your debt, and it also reduces the total amount of unpaid debt you have.

Keep in mind that you may incur costly interest charges if you only make minimum payments on high-interest debt. Alternatively, you can try to transfer the balance you owe to a credit card with a low annual percentage rate (APR) or 0% intro APR or negotiate a payment plan with your creditor.

Learn more in our balance transfer guide and explore our list of the best 0% APR credit cards.

5. Tackle your debt

Your credit score is greatly impacted by your credit utilization, which is the amount of credit you are using in comparison to the amount that is available to you. In other words, it’s how much you owe versus how much you can borrow.

For example, if you have a credit card with a limit of $1,000 and you owe $900, your credit utilization ratio on this card would be 90%.

Keep in mind
Keeping your credit utilization under 30% can help boost your credit score.

Learning how to get out of debt can help bring your credit utilization down, not to mention that it will also improve your overall financial health.

One way to tackle your debt is to pay off the accounts with the highest interest rates first. This is known as the debt avalanche method. Another way is to pay off accounts that have the smallest balances first. This is known as the debt snowball method.

6. Open a credit repair credit card

If you have a history of missed payments or limited credit history, opening a new credit builder card can be a useful strategy for improving your credit score. By demonstrating your ability to make timely payments, you can show lenders that you are a responsible borrower.

Of course, it can be challenging to obtain a credit card if your credit score is low, but there are credit cards designed for individuals with lower credit scores or limited credit history.

One common form of these cards is known as secured credit cards, which means that the card gives you access to credit in exchange for a deposit you make that is used as collateral. This deposit is typically equal to your credit limit and is designed to protect the card issuer from any potential losses. One example is the Secured Chime Credit Builder Visa® Credit Card12.

Find out more in our pick of the best secured credit cards.

7. Keep the progress going

Continue your efforts after establishing a solid DIY credit repair progress. This includes:

  • Make a budget: Take a look at your spending habits and create a budgeting plan that allows you to make on-time payments on your debts.
  • Monitor your credit reports: Keep an eye on your credit reports from all three credit reporting agencies (TransUnion, Equifax, and Experian) to ensure the accuracy of the information. Begin a dispute process for any errors you find.
  • Avoid applying for new credit cards you don’t need: When you apply for a credit card, it typically creates a hard inquiry on your credit report. This can negatively impact your credit score, so avoid applying for new credit cards when it's not necessary.
  • Seek professional credit repair advice: If you aren’t sure how to continue your credit repair journey, you can consider using a credit repair company or speaking to a financial advisor. They can help you create a customized plan that fits your specific needs.

4 important tips for successful credit repair

Improving your credit score through DIY credit repair can be time-consuming. However, these four tips can help speed up the process or make it more manageable.

1. Consolidate your debt

You can consider debt consolidation to group the money you owe into one manageable loan with a lower interest rate. Additionally, you can speak to your creditors about potential debt settlement and payment plan options.

One method to consolidate your debt is by taking out a new loan to pay off multiple debts, such as credit cards or personal loans. By consolidating your debts into one manageable loan, you reduce the number of outstanding balances, and you may qualify for a lower interest rate. This can make it easier for you to stay on top of your debts and pay them off faster.

You can also try settling your debt by negotiating with your creditors to reduce the total debt you owe. This can be a good option if you can’t make your payments due to financial hardship. You can also negotiate a payment plan that allows you to make more manageable payments over a longer period of time. This can help you avoid defaulting on your debts and can make it easier to stay on top of your payments.

2. Become an authorized user

If you have a friend or family member with a good credit score and a positive payment history on their credit card, you can ask them to add you as an authorized user on their account. Their credit card issuer would give you a card linked to their account without conducting a hard inquiry on your credit report.

As an authorized user, you are not legally responsible for paying the bills on the card, but the account appears on your credit report. This means that the payment history, account age, and credit utilization ratio are factored into your credit score.

Keep in mind that if the primary account holder makes late payments or maxes out the credit limit, it will also negatively affect your credit score. Therefore, it's essential that you trust the primary account holder to manage the account responsibly.

3. Get help when needed

The DIY credit repair process may feel overwhelming. For this reason, there are professionals who specialize in credit repair services that can help you. Credit repair companies can work with you to create a personalized plan that addresses the specific issues on your credit report and fits your financial situation.

These companies can also work with the credit bureaus and creditors on your behalf to dispute incorrect information on your credit report and negotiate payment plans. However, it's important to be cautious when choosing a credit repair company. Make sure to research and choose a reputable company with a good track record.

Explore our list of the best credit repair companies.

4. Avoid credit repair scams

Credit repair scams are a type of fraudulent activity that target individuals who are concerned about their credit. These scams are often carried out by dishonest companies or individuals who make false promises about improving your credit score but ultimately fail to deliver.

Keep an eye out for common red flags to avoid falling victim to credit repair scams. Make sure to:

  • Avoid companies that require payment upfront: Legitimate credit repair companies typically provide a free consultation and only require payment after providing their services.
  • Be wary of companies that promise a specific credit score: No legitimate credit repair company can guarantee a specific score increase, as credit scores are determined by multiple factors and can change over time.
  • Be careful of companies that insist on secrecy: Legitimate credit repair companies will be open and transparent about their services and processes.
  • Never dispute accurate information on your credit report: Disputing accurate information on your credit report isn’t only illegal and can cause more harm than good.

DIY credit repair FAQs

How long does it take to remove negative items from a credit report?

The time it takes to remove negative items from a credit report can vary depending on the specific item and the credit bureau reporting it. In many cases, negative items may stay on your credit report for up to seven years — although some items, such as bankruptcies, may remain on your credit record for up to a decade.

You can negotiate with your lender to remove negative items sooner, especially if you repay what you owe or are a current customer in good standing despite past mistakes.

Is paying someone to fix your credit worth it?

Whether it’s worth paying someone to fix your credit depends on your individual financial situation. You can do many of the services that credit repair companies offer, such as disputing errors on your credit report and negotiating with creditors, for free. According to the Fair Credit Reporting Act, credit bureaus are required to investigate disputes within 30 to 45 days and remove any inaccuracies found.

But if you don't know where to start and feel overwhelmed, working with a credit repair service can be worth it since your credit score affects several aspects of your financial life.

How long does credit repair take?

The time it takes to complete a credit repair process can vary depending on the specific issues on your credit report, your credit score, and the credit repair company you are working with. Some negative items may remain on your credit report for up to seven or even 10 years. However, the older the negative item is, the less impact it usually has on your score.

You can typically finish obtaining your reports and disputing inaccuracies within a few months. However, developing a positive payment history that reflects on your credit score typically takes longer.

Bottom line

DIY credit repair is an option that can be effective in addressing issues on your credit report and fixing your credit score.

You can fix your credit score by identifying errors and inaccuracies on your credit report, disputing them with the credit bureaus, and taking steps to establish a positive credit history. However, be aware that the DIY credit repair process can be time-consuming and requires effort and knowledge.

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Author Details

Christy Rakoczy

Christy Rakoczy has a Juris Doctorate from UCLA Law School with a focus in Business Law, and a Certificate in Business Marketing with an English Degree from The University of Rochester. As a full-time personal finance writer, she writes about all things money-related but her special areas of focus are credit cards, personal loans, student loans, mortgages, smart debt payoff strategies, and retirement and Social Security. Her work has been featured by USA Today, MSN Money, CNN Money and more, and you can learn more at her LinkedIn profile.