“Credit Repair will take care of it.”

Credit repair (or credit restoration) is not a Swiss army knife that will fix all of your credit problems. People who tell you otherwise are selling something, kidding themselves, or not thinking all the way through the nature of credit reports. Credit repair can only address problems with your existing credit file. In order to get a new credit history you must have new transactions appearing in your credit file.

These are the facts:

  1. Credit repair CANNOT give you a new or perfect credit history, because credit repair does not create any new history.
  2. Credit repair is often a useful tool for removing negative items from your credit report.
  3. Removing negative credit items may speed up your financial recovery.
  4. Removing negative credit items may improve your chances to get a new job or promotion and help you to acquire a new home or apartment.
  5. In order to fully rehabilitate your financial situation you will need to accomplish at lease these four things:

a. Maintain a stable income
b. Keep a reasonable budget
c. Minimize the effects of negative items from your credit report (thru credit disputes and/or the passage of time)
d. Create new credit history

As you work to recover from any financial hardship keep all three of these things in mind. A clean credit report is a good thing. Credit repair will often help remove negative items. But, a clean credit report without stable income, reasonable budget, and new credit transactions is something like owning a new car, but not having keys, gas, or air in the tires.