Strategies You Can Implement for Credit Restoration

If your credit score has taken a dive due to recent economic time, you probably are wondering what you can do to improve your score. Here are simple strategies that you can implement for credit restoration.

1. Dispute Derogatory Credit and Errors

The most basic strategy is to dispute negative information with the credit bureaus. This can be done online or via US mail. If you are serious about credit restoration, you might want to consider handling all of your disputes via certified mail. This gives you the documentation that you will need later to use other credit restoration strategies.

2. Pay Off Revolving Accounts

If you have the ability to pay off your credit cards, you will be rewarded by a huge boost in your credit score. This is especially true if you are carrying balances that are at or near your credit limits. Aim to get each of your accounts down below 20% of your available credit.

3. Develop Positive New Tradelines

If you are implementing a long term credit restoration plan, part of this plan may need to be opening new accounts so that you can show an ability to make timely payments. This strategy works when you have a long time horizon in which to improve your credit. You would not want to go open up new accounts if you are trying to qualify for a mortgage in two months, but it can make a lot of sense if you are trying to buy a home in two years.

4. Debt Validation

If you have tried disputing an account and were unable to successfully get the account removed from your credit file, you may want to try using debt validation. This is where you require the collection agency to prove to you that you owe them the money that they say you do. You should request original documentation, like an original signed contract. You also want proof that they now own the debt. Credit Repair