How often we've heard that credit repair is a scam, that it's not worth the trouble, or that it's downright unethical.  And while it's unfortunate that the more "illegitimate" credit repair companies have all but ruined the industry–we're proud to say that there is a very realistic, very effective, and very honest way to fix bad credit.

But first let's talk about what "credit repair" means to alot of these other companies.

How are Most Companies Fixing Bad Credit?

Perhaps the reason so many credit repair companies claim their services to be "fast" and "easy" is because they take so many short-cuts.

A common approach to dealing with negative credit reports is to send dispute letters to the credit bureaus and collection agencies, in hopes of getting as many removals as possible. 

And what's the problem with that?  It's ineffective at best and illegal at worst. 

Dispute letters are intended strictly for the purpose of having credit report errors corrected.  Any time a credit repair company disputes accurate credit report information, they are operating unlawfully and can add further complications to your credit situation. 

In some cases, disputing accurate information can even get you sued. 

So What's the Alternative? There's more than one way to fix bad credit.  But Dispute letters alone will not entirely resolve your problems.  That's why following a few simple steps can take you a long way in the credit repair process.

Remember that every credit situation is different–what works for others may not be the best option for you. But one way or the other, the laws that govern consumer credit and and the credit repair industry provide ways for you to gain conrol of your financial problems and get your credit back on track. 

So here they are…

The 5 Steps to Fixing Bad Credit that Anybody Can Follow

Step One:  Start A Working Budget It should be no surprise to hear that managing your money responsibly is the only way to establish a good credit history.  So if that's your goal (as it should be) then why put it off any longer?

The very best way to get things in order is to start budgeting–now!  Not only are you going to need some extra cash to pay off your old debts during the credit repair process, but you're going to have to have a handle on your money after you establish new lines of credit. 

Don't put it off–watch what you spend.

Step 2:  Get Familiar with Your Credit Report If you're going to fix your credit, you first have to know what's wrong with it–and that's pretty easy. 

Get a copy of your credit report (you can get it for free) and look over it carefully.  It should identify everyone you owe, how much you owe them, and the status of each account, etc., etc.  This, of course, is the only way to determine the approach you intend to take to resolve these problems, and therefore, getting familiar with your credit report should be a priority.

Step 3:  Have Fun Correcting Mistakes Correcting mistakes on your credit report can be fun–if you like writing dispute letters.

If you notice any errors on your credit report, you'll have to dispute it if you want to make it right.  This, as mentioned, is where many credit repair companies go wrong. 

Dispute letters do work, but they usually only work if they're intended to correct errors.  For all problems that dispute letters can't resolve, you'll have to take a different approach–and many of these companies do little beyond disputes.

Step 4:  Reduce the Heck Out of Your Debt After you've managed to ensure an accurate credit report, you may be wondering what you can do about all those unpaid debts and collection accounts.  And while getting yourself out of debt may seem impossible, learning how to negotiate debt-settlements can make it happen. 

A debt settlement occurs when a collection agency or creditor agrees to settle your debt for a reduced amount–an amount you can afford to pay.  And it works.  Our debt-relief specialists, on average, are able reduce most debts by as much as 60%.  So who says getting out of debt's impossible?

Step Five:  Establishing New Credit (and not screwing it up) so at this point you've learned to budget your money, you've conquered all credit report errors and you've managed to pay down your debt.  Your credit score has made a noticeable improvement, but you're still not experiencing the results you'd imagined.  Well, throw some new credit into the mix and relax.

You've done your part.  Your credit has improved, and it's going to get better.  Establishing new lines of credit is the best way (and the last step) to fixing bad credit.  And with proper management, you'll never have to worry about having bad credit again. 

For the Record… Credit repair is not a scam.  It's not ineffective, and it's not dishonest–or at least it doesn't have to be.  If you're worried about the troubles that can be caused by choosing the wrong company, do the smart thing and make sure you choose the right company.  There's just no room for short-cuts when it comes to credit repair–so stay away from the guys who can't offer a well-rounded, fool-proof approach to your credit problems.

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