Credit Repair Couple
Image Credit: iStock / Zinkevych

Any action you take to improve your credit can be called credit repair. Find and dispute an error on one of your credit reports? You’re working on credit repair. Learn ways to get better credit scores, including old habits to break? You’re working on credit repair. 

It doesn’t matter if you’re doing this yourself or if you’re paying a company to do it for you — working to improve your credit is credit repair.

Why Repair Your Credit?

It might seem like a lot of heavy lifting, but there are plenty of long-term financial benefits that can come with credit repair, including: 

Greater chance for credit approval

From car loans to mortgages, a positive credit history means a greater probability of getting approved for credit. 

Lower or no security deposits for various services

Many utility, cell phone, and cable companies run credit checks to determine whether you’ll have trouble paying your monthly bill. If your score is low, you could be on the hook for a larger security deposit.

Lower insurance rates

Insurance companies aren’t relying solely on credit information to determine rates, but certain aspects of your report are often considered. Progressive, for instance, reports taking payment history, number of open accounts, and credit utilization into consideration.

Access to better credit cards

If you have your eye on any of the best credit cards of 2020, then you’ll need a score in the good to excellent range (670-850). 

Lower interest rates

A high credit score can lead to a lower interest rate and savings that, according to MyFICO, could reach into the hundreds of thousands. Consider the impact interest rates can have on a mortgage with this calculation from their website:

  • $500,000 30-year fixed mortgage loan with a credit score of 760-850
    3.286% interest rate
    $2,186 monthly payment
    $286,932 in interest over the life of the loan

  • $500,000 30-year fixed mortgage loan with a credit score of 620-639
    4.875% interest rate
    $2,646 monthly payment
    $452,575 in interest over the life of the loan

[Wondering how interest rates work? Find out here.]

The Issue with Errors

When was the last time you checked your credit report? One of the primary reasons to consider credit repair are credit report errors – which are far more common than you may think. According to a 2013 FTC study

  • 1 in 4 people found errors on their report
  • 1 in 10 saw credit scores increase after disputing error 
  • 1 in 20 saw an increase of more than 25 points after disputing error 

Common Credit Report Errors

Once you have your credit reports in hand, what should you be looking for? Start with these common credit report errors.

Identity information

  • Incorrect name, address, social security number

Account information

  • Duplicate accounts
  • Accounts belonging to someone else with a similar name
  • Accounts added as a result of identity theft [link to credit fraud page]
  • Closed accounts reported as open
  • Inaccurate payment history
  • Inaccurate credit limits 

Balance information

  • Incorrect or outdated balance information

(TIP: Between now and April 2021, you can get all three of your credit reports weekly for free from

[Get more details on what items you should be looking for on your credit report.]

Credit Reporting Agencies and Credit Repair 

Unfortunately, finding and disputing errors requires more than looking over one credit report. There are three primary credit reporting agencies (CRAs) – Experian, TransUnion, and Equifax – and they don’t necessarily all have the same information about you. 

Lenders are not required to share information with all three CRAs and, as competitors, CRAs are not required to share information with each other. This means one report could reflect something positive or negative that another report does not. 

Therefore, it’s important to review each of the three reports and dispute incorrect information to the correct CRA. 

The Impact of Credit Report Errors

Credit report errors may be common, but their impact can be far-reaching and severe. Lenders and credit card companies consider different items on your credit report depending on the type of credit you’re applying for. However, if your credit report is showing inaccurate information in any of these areas (ultimately resulting in a lower credit score), you could be denied altogether or forced to pay higher interest rates and accept other less favorable terms. 

Here are just a few items that could raise a red flag based on credit type.


  • Bankruptcies
  • Delinquent accounts 
  • Recent credit applications
  • Accounts in collections
  • Foreclosures 
  • Limited credit history

Personal Loans

  • Multiple hard credit inquiries within a short period of time
  • Delinquent accounts
  • Late payments

Auto Loans 

  • Delinquent accounts
  • Late payments 
  • Multiple hard credit inquiries within a short period of time
  • High credit utilization (above 30%)

Credit Cards 

  • High credit card utilization rate (above 30%)
  • Multiple hard credit inquiries within a short period of time
  • Limited credit history
  • Accounts in collections

[Read more about the most common credit report errors.]

Getting a Loan with Bad Credit

While bad credit is certainly a hurdle in getting approved for new credit, it doesn’t necessarily make it impossible. Here are a few tips to help. 

  • Personal Loan
    For personal loans, start at the bank or credit union you use – if your history with that institution is positive. Or, consider looking online for options that cater to those within your credit range.

[Read tips on getting a personal loan with bad credit.

  • Mortgage
    A conventional loan might be off the table, but a government-backed FHA loan only requires a score of 580 or above (though FHA loan limits vary based on where you live). You may also consider a rent-to-own home or finding a cosigner to help your chances of getting approved.

[What credit score do you need to get a mortgage? Read our breakdown, then find out how to buy a house or a vacation home with bad credit.]

  • Auto Loan
    Getting approved for an auto loan may come down to finding a bad credit car dealership, bringing on a cosigner, increasing your down payment – or a combination of all three.

[Get the details on how to buy a car with bad credit.

  • Credit Cards
    Applying for a secured credit card might be your best bet if your credit is bad. Secured cards may require a deposit (which could be the same amount as your credit limit), but with a positive payment history, they can be a stepping stone to a traditional credit card.

[Here’s what you need to know about getting a credit card with bad credit.

How Credit Repair Companies Work

If credit repair seems like an overwhelming task to take on, there are plenty of companies ready to help – for a fee, of course. It’s important to note, however, that credit repair companies are generally not able to do anything you can’t do on your own. They are essentially just managing communication and (hopefully) guiding you in the right direction. Here are a few things they can do:

  • Analyze your credit report and pinpoint potential errors.
  • Compile and send dispute letters to the correct CRA on your behalf.
  • Negotiate with creditors to amend or remove inaccurate information. 

Some Credit Repair Companies Which Charge Fees

  • Lexington Law
    Headquartered in Utah and available in all states with the exception of Oregon and North Carolina, Lexington Law has mixed reviews and a C rating by the BBB. They are currently under investigation after the Consumer Financial Protection Bureau filed a complaint alleging “deceptive and abusive telemarketing acts or practices” and  violation of a federal law that prohibits collection of an upfront fee for “certain telemarketed credit repair services.”
    Cost: $89.95 – $129.95 monthly
    Also headquartered in Utah, has an F rating by the BBB. They are currently under investigation for the same alleged abuses as Lexington Law – namely collecting an upfront fee before credit repair services are performed. They boast an average of 28 credit report items challenged per member, but many customer reviews state otherwise.
    Cost: $14.99 initial fee, $99.95 monthly
  • Sky Blue Credit Repair
    Available in all 50 states, Sky Blue Credit Repair has a C rating by the BBB. They  are labeled as “advanced fee credit repair” – although they don’t appear to be under investigation for this practice like previously mentioned companies. Beginning with a line-by-line review of your report, they promise to point out the items eligible to dispute, challenge them, and offer other tips to rebuild your credit.
    Cost: $79 initial fee, $79 monthly

(Current as of March 1, 2020. All information related to these credit repair companies is subject to change.)

Free Credit Repair

Upturn, the site you’re on right now, is a free service that allows you to review and dispute potential errors on your TransUnion credit report. By taking you step-by-step through items on your report, you can easily pinpoint what should be disputed, follow the dispute once it’s initiated for you, and stay on top of monitoring your report going forward.
Cost: Free
Sign up and get started with these steps:

    • Make sure all open and closed accounts are yours
    • Dispute information reported in error 
    • See a snapshot of your credit utilization and how it is impacting your credit
    • Determine your debt-to-income ratio – a number lenders use to determine credit worthiness
    • Review your payment status on each account

How to Spot a Credit Repair Scam

While some credit repair companies are reputable and effective, be aware there are some bad players in the bunch. Before paying for services, pay attention to these red flags

They demand an upfront payment.
According to the Credit Repair Organizations Act, “No credit repair organization may charge or receive any money or other valuable consideration for the performance of any service which the credit repair organization has agreed to perform for any consumer before such service is fully performed.”

They don’t explain your rights.
Credit repair companies are required to provide written disclosure of your rights before a contract is executed – including that you are entitled to dispute credit report information on your own (for free).

They promise to remove negative – but otherwise accurate – information.
Reputable credit repair companies work to remove errors or unverifiable information from your credit report – not accurate information that happens to be negative.

They try to get you to not contact credit reporting agencies (CRAs) on your own.
It is well within your rights to receive a free credit report from each of the three credit reporting agencies (just go to and work to reconcile errors on your own. Be wary of any credit repair company that says otherwise.

They try to convince you to lie on credit applications.
According to the FTC, some credit repair companies will go as far as selling new social security numbers or encouraging the use of an EIN (employer identification number) for a “fresh start.” Not only is this illegal, but it could lead to costly fines down the road.

DIY Credit Repair 

Credit Repair Software 

There’s a happy medium between handing over your credit repair case to a company and doing it all on your own. Credit repair software can give you the tips and tools to guide you in the right direction, while still allowing you to man the ship.

  • Experian Boost
    If your credit history is limited, or if you could benefit from the addition of certain accounts – like utilities – Experian Boost may be able to help. After signing up and linking the account you use to pay your bills, Experian will go to work finding accounts with on-time payment histories. You are then able to determine if you want these accounts added to your Experian credit report. The downside: Any credit improvement will only be reflected in your Experian credit score (not your TransUnion or Equifax credit score).
    Cost: Free
  • Personal Credit Software
    Personal Credit Software allows you to import your credit reports from each of the three CRAs, then offers access to professional dispute letters to correct any errors you find. Pricier than other options, they promise to automate the credit repair process and save you from hours of tedious tasks.
    Cost: $199.97
  • TurnScor
    With an e-book, videos, and software to help you manage and stay on top of the credit repair process, TurnScor places an emphasis on credit education and learning better habits. From their online interface you can access your three credit reports, find errors to dispute, print challenge letters generated for you, and keep track of your repair progress.
    Cost: $159
  • Credit Detailer
    A robust software option used primarily by businesses offering credit repair or coaching, Credit Detailer offers information to help you understand the repair process, and an interface to help you create dispute letters and keep track of your progress going forward.
    Cost: $399 (software + 1 hour of credit coaching)
    $499 (software + 3 hours of credit coaching over a 4-month period)

[Find out how to start repairing your credit today (for FREE!) with Upturn.]

Next Steps to Repair and Improve Your Credit

Once you know your credit report is a fair and accurate representation of your credit history, then you can start taking steps to improve your credit, such as:

Managing any accounts you have in collections.
Contact the collections agencies and work to negotiate a payment plan or settle the debt (and be sure to get any agreement you make with them in writing). This will ensure these accounts don’t stay on your report any longer than necessary.

Working to consolidate or pay down your credit card debt.
High credit card balances can drastically hurt your credit scores. Take the steps to get your credit utilization ratio at 30 percent or lower (the lower the better.) 

Paying all future bills on time.
Payment history is widely cited as the largest factor impacting your credit scores. Start establishing those good payment habits now.

Avoiding applications for new credit unless you absolutely need it.
Regularly applying for new credit can make you look like a credit risk to future lenders. In addition, new credit can lower your average account age which also impacts your score. If you do need to apply for new credit, make sure to rate shop so your credit doesn’t take more of a hit than it needs to.

Keeping old credit accounts open.
Credit history is a factor in your credit scores that’s easy to maintain. This also keeps your available credit higher relative to the amount of credit you are actually using, which is also important.

[Find out how certain moves impact your credit score and how to improve yours.]

The Bottom Line 

There are multiple ways to tackle credit repair, but generally the benefits far outweigh the work involved. From lower interest rates to better loan and credit card options, your wallet will feel the impact of higher credit scores for years to come. 

[Ready to get started? Signing up for Upturn is quick and easy.]