Do-It-Yourself Credit Repair: The Essential Guide


Finding out you have bad credit usually comes at the worst possible time. You might not even know how bad it is until you get denied a new credit card, cell phone, or car loan.


When you check your credit reports, you may be surprised to find one or several negative accounts tarnishing your credit scores. Or maybe you’re not even sure how to interpret all the information listed there!

Once you figure out what’s on your credit reports and how it affects your credit scores, you can start your DIY credit repair journey. Fixing your credit is not something that you can do overnight. However, you also don’t have to wait years to see improvement.

Do-It-Yourself Credit Repair: The Benefits

As you start to see that number increase, you’ll also begin to notice all the related benefits that come with having a good credit score. For example, you’ll be able to get approved for more credit cards. And as long as you use them responsibly, you’ll be able to get higher credit limits and lower interest rates.

You don’t have to carry the burden of bad credit for the rest of your life.

In this DIY credit repair guide, you’ll learn what factors affect your credit score, plus both short-term and long-term strategies for fixing your credit. We’ll also teach you how to get negative information removed from your credit reports and where to go if you need additional help.

What Determines Your Credit Score?

Your credit score is a numerical reflection of all the financial information contained in your credit report that comes from one of three major credit bureaus: Equifax, Experian, and TransUnion.

Creditors, lenders, and other companies send them your payment history to help build an accurate representation of your creditworthiness.

Some creditors report to all three bureaus, while others may only report to one. The information on your credit report is then filtered through a scoring model to create your credit score.

FICO Scores

Different credit scoring models are used for credit scores, but the FICO score is the most popular one used by lenders and credit card companies. FICO credit scores range from 300-850.

When a creditor reviews your application for a new credit card or loan, they’ll check your credit reports and credit scores to determine your creditworthiness.

Creditors will decide if you qualify for a credit card or loan based on that and other financial information. If you do qualify, you’ll receive a higher interest rate if you have a poor credit history. This is because they think you pose more of a risk of defaulting on your payments if you have a rocky financial past.

You get the best terms and conditions available when you have excellent credit scores. That’s why it’s essential to have the highest credit score possible so you can keep your interest payments low.

So, what exactly is on your credit report, and how does it affect your credit score? Here’s how it shakes down.

Payment History

The biggest chunk of your credit score is determined by how well you pay your bills each month. In fact, payment history accounts for 35% of your credit score! You’ll see this history listed on your credit reports through different credit accounts you’ve had over the last seven years.

Under every loan, credit card, or mortgage you’ve had, you’ll see how much you’ve paid each month for an extended period of time. You’ll also see your total balance.

Other creditors like cell phone carriers or utility companies can report late payments, but they typically don’t report payments that are made on time.

If you do have a late payment listed, it’ll be marked with exactly how late it was. This can range from 30 days to 150 days (or more, if the account went into default). So naturally, the later the payment, the more your credit score will drop as a result.

Total Debt

Next, 30% of your FICO score relates to how much debt you owe. Installment loans like a mortgage or student loan aren’t weighed as heavily as revolving debt like credit cards.

Lenders look at your debt-to-credit ratio, or credit utilization. It basically shows how much you owe compared to your maximum line of credit on your credit cards.

If you’re close to being maxed out, your credit suffers. Since it’s a ratio, two people with the same credit card balances could have different credit scores if one has higher credit limits.

For example, a person with $3,000 charged on a credit card with a $10,000 credit limit only has a 30% debt-to-credit ratio. But someone else with $3,000 charged on a credit card with just a $5,000 credit limit would have a 60% ratio and — all other things being equal — a much lower credit score.

Length of Credit History

15% of your credit score hinges upon the length of your credit history. Lenders can’t gauge your ability or willingness to repay a loan if you have a limited credit history. The FICO credit scoring model considers how long your various credit accounts have been open, including loans and credit cards.

Unfortunately, rent payments aren’t included in the FICO score. However, there are rental reporting services that you could use as additional documentation in your credit application.

New Credit Accounts

Another section you’ll see on your credit reports is called Inquiries. This refers to each application for new credit you’ve submitted in the past two years. It accounts for 10% of your FICO score.

Each hard inquiry drops your credit score by about five points during the first year. This is unless you’ve made multiple credit inquiries for the same product within a few weeks of each other. That just indicates you were rate shopping for a loan or credit card and in this case, they’re treated as a single inquiry.

Credit Mix

The final 10% of your credit score is determined by the types of credit you have. We mentioned that revolving credit like credit cards or retail cards hurt your credit score more than installment debt. Installment loans have some sort of asset tied to them, like a house or a car.

You are more likely to repay these loans than unknown purchases from a credit card since you own something of value.

Student loans are also viewed more favorably than credit cards because they indicate an investment in your future earning power. They figure the more money you make, the faster you can pay off your loans!

Negative Information on Your Credit Report

The FCRA limits the length of time a negative item can stay on your credit report. However, positive and neutral items are typically reported indefinitely.

Plus, the amount of damage each negative mark causes on your credit score fades little by little over time. That means your bad credit can’t last forever as long as you start implementing positive behaviors.

Negative accounts can successfully be removed from your credit history before the usual time limit. However, it’s not always possible depending on your situation. You might also prefer spending your time getting newer negative marks removed since older ones drop off sooner.

Here’s a look at each type of negative account you may find on your credit reports. We’ll also tell you how long they’re likely to stay there if you can’t or don’t attempt to get them removed.

Charge Offs

A charge-off occurs when a creditor decides a debt is not collectible. So, rather than carry it on their books as an overdue or past-due debt, they can instead eliminate it from their reportable past due accounts.

By charging off the debt, it improves the company’s accounts receivable report. However, that doesn’t mean the debt has disappeared. In most cases, the debt is sold to a “debt buyer” who pays pennies on the dollar for the face value of the debt.

By purchasing the debt, the debt buyer can now attempt to collect the amount owed (plus court fees, interest, late charges, and more.) They contact the debtor and often take them to court for the full value plus any applicable fees.

Charge offs can remain on your credit report for up to seven years plus 180 days from the original date of delinquency.


Collections are complicated because paying them off may actually end up hurting your credit score by resetting the start date from when it was reported. Before taking action on collections, read on to find out how to navigate these murky waters.

Like charge-offs, collection accounts can stay on your credit report for up to seven years from the date you first fell behind with the original creditor.

Late Payments

Even if you eventually catch up on what you owe, any payment more than 30 days late can appear on your credit report.

However, some creditors don’t report the past due payment until a second payment is owed. This is because they want to avoid upsetting good customers who simply forgot the deadline and made it up the following month. Credit reporting agencies require that creditors report all past-due payments after a second payment is missed.

Delinquent accounts stay on your credit report for up to seven years after the date of the last scheduled payment.


Bankruptcies stay on your credit report for no more than ten years. If the court dismisses your case, the ten years will start from the date of dismissal.

The amount of time also depends on the type of bankruptcy you filed. For example, chapter 13 bankruptcies stay on for only seven years, while Chapter 7 bankruptcies stay on your credit report for the full ten years.


Foreclosures remain on your credit report for up to seven years. Luckily, you don’t have to wait that long to buy a new house once you regain your financial footing. You could qualify for a mortgage as soon as two years, though sometimes longer depending on the type of loan.


Judgments can stay on your credit report for up to seven years or until the statute of limitations expired, whichever was longer. However, the three major credit bureaus no longer include judgments on your credit reports.

Most statutes of limitation are shorter than seven years. So, seven years is likely the maximum time a judgment or lawsuit will show up on your credit history. To be sure, check your specific state laws for details.


Repossessions can stay on your credit report for up to seven years as well. However, you still remain liable for any remaining debt after a property (such as a car) has been repossessed, regardless of whether it appears on your credit report.

The DIY Credit Repair Method

Do-it-yourself credit repair is certainly possible without hiring a professional credit repair company. Before you begin, though, you’ll want to familiarize yourself with the Fair Credit Reporting Act (FCRA). You need to know your rights when dealing with credit bureaus, creditors, and even collection agencies.

Follow these step-by-step instructions to learn how to identify negative entries like late payments, delinquent loans, and others. This will give you the best chance of getting them eliminated from your credit history.

Step 1: Access Your Free Credit Reports

Hopefully, you’ve already accessed a copy of your credit report from Equifax, Experian, and TransUnion. If not, the FCRA allows you to get one free credit report from each credit bureau at every twelve months.

You can download your free credit report in minutes after entering some personal information and answering a few security questions. You can also send a request for a hard copy of your credit report to be sent in the mail if you prefer. Or you can call 1-877-322-8228.

Step 2: Review Each Credit Report Carefully

Once you have your free credit report in hand, you should check each one for accuracy. Your credit reports won’t always be the same since some creditors and lenders only report to one or two credit bureaus.

Even if they do report to all three credit bureaus, one credit bureau may make a mistake when entering your payment history. So, you must look at all three credit bureaus with a fine-tooth comb instead of just assuming that the information is the same on each one.

Personal Information

First, make sure your basic personal information is correct and that no other individuals are listed on your credit reports. Then, carefully scroll through each page and look at all of your account information.


Look at everything from the opening date of your account to the highest balance you’ve had. Make a note of any account that looks incorrect or even questionable, especially if there’s a negative mark like a late payment.

You also want to confirm that you own each of the lines of credit to make sure no one has fraudulently opened an account under your name. If there are any accounts you don’t recognize, you may have been a victim of identity theft.

Collections & Public Records

Once you’ve looked at all of your open and closed credit accounts, pay close attention to the negative records section of your credit report.

Here you’ll find any accounts you haven’t paid as agreed, collections, or public records you’ve had. Anything listed in this section causes the most damage to your credit score. It should likely be on your list of items to dispute.

Step 3: File Disputes and Request to Have Negative Info Removed

If you find any inaccurate, untimely, misleading, biased, incomplete, or questionable items on your credit report, it’s both your right and responsibility to dispute the information and get it removed. Plus, removing negative items on your credit history can also positively impact your credit score.

While many people still don’t realize that it’s possible to have them removed, thousands of consumers are successfully disputing such items with the credit bureaus every day. So, it’s easier than you might think. It’s also a much better alternative to simply waiting years for negative information to drop off your credit report.

Writing a Credit Dispute Letter

Start by mailing a credit dispute letter to the credit bureau listing the negative item. You can find a sample dispute letter here. Keep a copy for yourself, and make sure you sent it by certified mail, return receipt requested so you have proof they received your letter.

From that point, the credit reporting agency has 30 days to respond to your request. If you ordered your credit report from, they have an additional 15 days to respond, making it a total of 45 days.

Some people will tell you that you can dispute online. However, we’ve found that people get much better results disputing through the regular mail. To find out more, please refer to Why You Should Never Dispute Credit Report Errors Online.

What to Include

In your dispute letter, make sure you detail all the incorrect information in your credit report. If you have supporting documentation, include copies — not the originals. But, it is not necessary to include supporting documentation. Remember, the burden of proof is on the credit bureaus and creditors reporting the information about you.

Moreover, be sure to include your name, phone number, and current address. Use a polite and professional tone without injecting any opinion. You can either list the reasons why you’re disputing or simply state that you wish to dispute it.

Once you request the dispute, federal law requires the credit reporting agencies to investigate, and the relevant creditor must provide proof of the item’s accuracy.

You might have to go back and forth several times between the creditors and credit reporting agency. It can take a lot of time and effort, but the effects on your credit scores could well be worth it.

How to Improve Your Credit Score

Even if you can’t remove any negative items from your credit report or decide to let them fall off naturally, you can still improve your credit score. It’s also essential to handle collections with care so that you don’t mistakenly reset the date of the statute of limitations.

Follow these steps as part of your comprehensive DIY credit repair strategy to ensure that you take full advantage of all opportunities and avoid unintended setbacks. Doing this incorrectly could cause lasting damage to your credit history.

Assess Your Accounts in Collections

Start by looking at your recent collections. They impact your credit most because newer debt is weighted more heavily. Furthermore, pay attention to the type of debt you’re paying.

Medical debt doesn’t affect your credit score as much as other types of debt, so focus on any nonmedical debt first. Try to make full payments since partial payments can reset the time limit for how long those accounts can remain on your credit reports.

You can also attempt to negotiate a settlement with the collection agency to pay less than you owe. Just remember that you may have to report the amount that was dismissed as income on your tax return. This could result in higher taxes and even a higher tax rate if it bumps you into another income bracket.

Another issue with paying off debt collections can occur if the collection agency acts as if you haven’t made any payment at all. Avoid this scam by getting payment agreements in writing and keeping copies of all documents related to the account.

Continue to Monitor Your Credit

Once you’ve taken care of your accounts in collections, make sure those changes are accurately reflected on your credit report. It may take a month or two for the accounts to drop off, so wait several weeks before checking your credit report and your credit score.

If you don’t see any positive changes or the negative item is still listed, you should file a dispute with the credit bureau. As long as you keep good records, you should have all the appropriate documentation you need for a quick dispute process.

Quick Tips for Repairing Your Credit

Getting negative items on your credit report removed can have spectacular results on your credit score. However, the credit repair process can take a lot of time.

If you’re looking for quick improvements, you can still use a few strategies. Some are minor fixes, while others can still have a significant impact. So, check the whole list to see which ones you can try today to fix your credit.

Lower Your Credit Utilization Ratio

Remember that credit utilization ratio we talked about earlier? The closer you are to maxing out your credit cards, the lower your credit score will be.

So, it makes sense that paying down high credit card balances can lower your ratio and increase your credit score. Focus on maxed-out credit cards rather than those with low balances. By keeping your credit card balances low, you could see as much as a 100 point increase over a few months.

Request a Credit Limit Increase on Credit Cards

If you can’t afford to pay off the extra debt to decrease your credit utilization, you still have a chance for improvements. Call your credit card issuer and request a credit limit increase on your credit card.

You don’t want to actually charge any more than you already owe. Instead, you simply want to have a higher credit limit so that your existing credit card balance consists of a smaller percentage of your available credit.

Here’s an example. Say you owe $5,000 on a credit card with a $10,000 limit. You’d be utilizing 50% of your credit. But if you got your limit up to $15,000, then your $5,000 balance would only be using 33% of your limit.

When making the call to your creditor, it helps if you’ve submitted regular timely payments throughout your history with them. More than likely, they’ll value customer loyalty enough to help your credit line.

Become an Authorized User

Building your credit history takes a lot of time, but there is a shortcut available. You can become an authorized user on a friend or family member’s account who has long-standing, strong credit. That credit card account will automatically be added to your credit report in its entirety.

There’s a bit of risk involved with this move. If your friend or relative stops making payments or carries a large balance, those negative entries will be added to your credit history.

Likewise, if you rack up high balances and don’t make your payments, the other person’s credit will suffer. Of course, they don’t even need to give you access to the credit account for this to work. They just need to put your name on the account. This can be a great tactic, but it does require some caution.

Consolidate Your Credit Card Debt

Another quick way to repair your credit is to consider getting a debt consolidation loan. It’s a type of personal loan that you can use to pay off your various credit cards, then make a single monthly payment on the loan.

Depending on your interest rates, you might be able to save money on your monthly payments by getting a lower loan rate. Shop around using pre-approvals to see what kind of rates you qualify for and how they stack up compared to your current credit card rates.

Even if your monthly payment stays the same, your credit score will still see a boost because installment debt is viewed more favorably than revolving debt.

Get a Credit-Builder Loan

Smaller banks and credit unions often offer credit-builder loans to help individuals repair their credit. When you take out the loan, the funds are deposited into an account that you’re unable to access.

You then begin making monthly payments on the loan amount. Once you’ve repaid the entire loan, the funds are released for you to use.

It may seem strange to make payments on money you can’t even spend, but it’s a way for the financial institution to feel protected while you get a chance to prove yourself as a responsible borrower.

Once you complete your payments and receive the money, the bank reports your on-time payments to the three credit bureaus, which helps your credit score.

How to Maintain Your Credit Health Over Time

After you’ve taken care of all the items from your financial past affecting your current credit, it’s time to look towards the future. Here are some tips to get you started maintaining that increased credit score so that you don’t fall back into old patterns.

Stick to a Budget

Living within your means is one of the most important ways to keep your finances and your credit on track. So, even if you’re good at making your paychecks last each month, make sure you’re tucking a portion of your money away in a savings account so that you can take care of any financial emergencies that pop up.

Avoid putting extra expenditures on a credit card because it’s more difficult to monitor how much you’re spending. Instead, check your bank account each evening to see how you’re doing, or even use the all-cash method to prevent tempting yourself with impulse buys.

Pay Bills On Time

Your credit score is heavily influenced by how timely you pay your bills, particularly those that report to the three credit bureaus. Just a single late payment can cause your credit score to take a serious nosedive.

Get out the calendar and start organizing your due dates so you know exactly what you owe throughout the month. If you need extra help, set up automatic payments through your bank.

Use a Secured Credit Card Responsibly

After getting your monthly finances together, you want to start thinking about further complementing your credit with a credit card. If you have trouble getting approved for one, consider signing up for a secured credit card. It’s specifically designed for people recovering from poor credit.

You make a security deposit in an amount that serves as your credit limit. You don’t pay for your monthly balance out of that fund. It simply serves as collateral as you start to make payments on time.

You might start with a limit as low as $500. Then, over time, you can work up to higher credit limits and eventually get rid of the secured credit card altogether. Meanwhile, you’ll build up a new history of positive payments regularly reported each month.

Sign Up for a Credit Monitoring Service

Credit monitoring services allow you to keep an eye on your credit report and credit score. The best credit monitoring services come with a small monthly fee, while others, like Credit Karma, are completely free. Either way, consider monitoring your credit score regularly so you can stay on top of your credit scores.

How Else Can I Get Credit Repair Help?

When you feel intimidated by repairing your credit, there are several resources you can tap to get help. Some are free, while others cost money depending on the credit repair services they provide.

If you choose a credit repair company, make sure they have independent positive reviews and always look out for your interests.

Consumer Agencies

One of the most difficult obstacles when it comes to DIY credit repair is misinformation. If you want to be certain you’re getting valuable information that you can trust, you need to find reputable sources. Luckily, there are several agencies that can help point you in the right direction.


The Federal Trade Commission (FTC) is responsible for protecting consumers’ rights. This government agency offers information on credit and credit repair, as well as tips on hiring a reputable credit repair company.

Because the Federal Trade Commission investigates thousands of fraud claims involving credit repair, they take an extra cautious stance regarding credit repair companies in general.


The Consumer Financial Protection Bureau (CFPB) helps protect consumers from unfair, deceptive, or abusive practices. They take action against companies that break the law. The CFPB’s website is often the best place to submit a complaint against financial products or services.

When you submit a complaint, the CFPB works to get you a response. Most companies respond to the complaints within 15 days.


The Better Business Bureau (BBB) is another consumer advocacy organization, but it’s not a federal agency.

However, they collect information on both local and national levels about all types of companies, including credit repair companies. They also provide free resource pages that cover various tactics on managing your credit and getting yourself on track.

Free Credit Consultations from Credit Repair Professionals

Many credit repair companies offer credit help for free, at least in terms of initial information to get started. It’s common for credit repair companies to offer free initial consultations. They also offer free downloadable documents to help you on your path to increase your credit score.

This is typical of most reputable credit repair companies. You’ll get personalized advice based on your situation, along with how they recommend you proceed. In addition to providing you with an action plan, an honest credit repair company won’t ask you to sign anything until you’re ready.

Feel free to get consultations with more than one credit repair service so you can compare strategies and prices and pick the one that feels right to you.

Accessing Information from Specialized Bureaus

Once you’ve got your credit report in order from the three major credit bureaus, you may want to obtain free credit reports from specialized credit bureaus.

The information on these credit reports may or may not be relevant to you. It just depends on your financial history. Here is a brief background on each one to give you an idea of other places that might impact your creditworthiness.


You might be listed in ChexSystems if you have had trouble with a bank account in the past. You could have had a checking account closed due to excessive bounced checks or insufficient funds, unpaid negative balances, or other issues.

About 80% of banks use this ChexSystems for the account approval process. So, the next time you try to open an account at another bank, you’ll likely be denied if you’re in ChexSystems. However, there are also many great banks that don’t use ChexSystems.

You can access your ChexSystems report by contacting them here:

Attention: Customer Relations
12005 Ford Road, Suite 600
Dallas TX 75234

See also: No ChexSystems Banks

CLUE Report

You may not have knocked off Professor Plum in the library with the candlestick, but you still might have a CLUE Report. This agency tracks your insurance history and any claims you may have filed in the past.

It covers both auto claims and personal property claims. Additionally, it’s used by insurance companies to determine whether they want to offer you new coverage and how much they’re willing to provide. If you have a substantial history of claims over the last seven years, they may hesitate to offer a comprehensive insurance plan.

Here’s how to find out what’s on your CLUE Report:

(866) 312-8076

Judicial Judgments

If you’ve had any type of civil lawsuit, tax lien, bankruptcy, or other judicial judgment, you can access all of your public records from

Rather than going to multiple locations in different cities and states where you’ve lived, you can instead order your public records from this one spot.

Utilities History

When you sign up for utilities at a new home or apartment, the utility company will check your previous history against the National Consumer Telecom & Utilities Exchange (NCTUE).

The utility company can then see if you’ve had a history of delinquency and decide whether to provide you with service. Access your own utility history at NCTUE.

Rental Background

Many landlords also do a background check when selecting their next tenant. Occasionally, they do this as a soft pull on your credit report.

They might also access your rental history through a service that specifically screens renters for information like evictions, criminal records, and identity fraud. SafeRent is one such company providing this service to landlords.

Medical Insurance History

Finally, the Medical Insurance Bureau tracks your medical insurance claims. This helps future insurance companies determine your health background and the risk associated with taking you on.

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