Credit repair playbook

Keep credit monitoring on, always

What it is. Monitoring alerts you to new accounts, inquiries, and changes so you can act fast and track your disputes. It is the early-warning system for everything else in this playbook.

When to use it. From day one, and for as long as you are repairing, building, or protecting your credit. Keep it on after repair is finished too.

1. Pick a service that watches all three nationwide bureaus, not just one.
2. Turn on alerts for new accounts, new inquiries, address changes, balance changes, and public records.
3. Check that the alerts go to an email or phone you read every day.
4. Open each alert the day it arrives. Anything you do not recognize is worth a closer look right away.
5. Use the history it keeps to track each dispute: note what changed and when.

Checklist

• Monitoring is on for all three bureaus
• Alerts go to an email or phone I check daily
• I know who to contact if I see an account I do not recognize
• I log each alert in my tracker

Get your free credit reports

What it is. You can pull your reports from each nationwide bureau for free. Reading them line by line is the first step of any repair plan.

When to use it. Before you dispute anything, before you apply for a loan, and any time monitoring shows something odd.

1. Go to annualcreditreport.com, the only site authorized by federal law for free reports.
2. Request your report from each of the three bureaus. The bureaus have made weekly free reports permanent, so you can check as often as you like.
3. Read every account, inquiry, and personal detail. Mark what is wrong, not just what is negative.
4. Save or print each report and note the date. Your tracker keeps your list of items.

Checklist

• Pulled all three reports from annualcreditreport.com
• Marked every item that is inaccurate or not mine
• Saved a dated copy of each report

Dispute basics

What it is. A dispute is a written request to correct something on your report that is genuinely inaccurate or incomplete. The Fair Credit Reporting Act (FCRA) gives you the right to do this.

When to use it. When you find an item that is wrong: a balance, a date, a late mark that was not late, an account that is not yours, or a duplicate.

1. Dispute only what is genuinely inaccurate or cannot be verified. Never dispute accurate information as inaccurate.
2. Send the dispute to the bureau that shows the error. You can also dispute with the company that reported it (the furnisher).
3. Say exactly what is wrong, attach copies (never originals) of proof, and keep a copy of everything.
4. Send it by certified mail with a return receipt, or use the bureau's online dispute and save the confirmation.
5. The bureau generally has 30 days to investigate (15 U.S.C. 1681i). If you send relevant additional information during that time, it can take up to 45 days.
6. When the bureau tells the furnisher about your dispute, the furnisher must investigate too (15 U.S.C. 1681s-2(b)). The bureau must send you the results in writing.
7. If the item stays and you still have proof it is wrong, add a short consumer statement or dispute again with new documents.

Checklist

• Confirmed each disputed item is genuinely inaccurate
• Attached copies of proof, kept the originals
• Sent by certified mail or saved the online confirmation
• Wrote the 30 day and 45 day dates in my tracker
• Kept a copy of every letter and response

Debt validation

What it is. When a debt collector first contacts you, federal law lets you ask them to prove the debt is yours and the amount is right.

When to use it. When you get a first notice from a collector, especially for a debt you do not recognize or the amount looks off.

1. Look for the validation notice. Under Regulation F (12 CFR 1006.34) it lists the debt, the creditor, the amount, and your rights.
2. You have 30 days after you receive the notice to dispute in writing (15 U.S.C. 1692g). A collector may assume you received it about five business days after sending.
3. Send a written dispute or validation request by certified mail within that window and keep a copy.
4. If you dispute in time, the collector must stop collecting that debt until it sends verification (15 U.S.C. 1692g(b)).
5. Keep every notice, envelope, and call note. If a collector breaks the rules, you can file a complaint with the CFPB.

Checklist

• Noted the date I received the first notice
• Sent my written request inside the 30 days
• Kept proof of mailing
• Did not agree to pay or acknowledge the debt in a phone call

Statute of limitations warning

What it is. The statute of limitations (SOL) is the time limit a creditor or collector has to sue you over a debt. It is set by state law and varies by state and type of debt.

When to use it. Before you pay, promise to pay, or sign anything on an old debt.

1. Find out when the last payment or activity on the account happened.
2. Look up your state's SOL for that kind of debt, or ask a consumer attorney or legal aid office.
3. If the debt may be time-barred, do not pay anything and do not acknowledge it in writing until you understand the rules where you live.
4. If a lawsuit is filed, respond before the deadline. Ignoring a summons can lead to a default judgment.

Checklist

• I know the date of the last payment or activity
• I checked my state's SOL for this type of debt
• I have not made a partial payment or written promise on an old debt

Goodwill letters

What it is. A goodwill letter is a polite request to a creditor to remove an accurate late mark as a courtesy. You are asking, not demanding.

When to use it. When you have a strong record otherwise, the late payment was a one-time slip, and there was a real reason such as illness or a bank error.

1. Pay the account current first if you can.
2. Write to the creditor's customer relations or executive office. Be brief, honest, and respectful.
3. Explain what happened, what has changed, and that you have paid on time since.
4. Ask if they would consider removing the late mark as goodwill.
5. Keep a copy. If the answer is no, you can ask once more later, but do not pressure them.

Checklist

• Account is current
• Letter is honest and short
• Sent to the right address, copy kept

Pay-for-delete cautions

What it is. A pay-for-delete is an offer to pay a collection in exchange for the collector removing it from your report.

When to use it. Only when you are already prepared to settle a debt that you owe and know it is not time-barred.

1. Confirm the debt is valid and still collectible (see validation and SOL above).
2. Ask for the agreement in writing, with the exact deletion promise, BEFORE you pay anything.
3. Pay by a traceable method, never by giving someone access to your bank account.
4. Keep the signed agreement and proof of payment, then check your reports in 30 to 60 days.

Checklist

• Agreement is in writing before I pay
• It states the deletion and the amount
• I kept proof of payment
• I checked all three reports afterward

Authorized-user strategy and its limits

What it is. Being added as an authorized user on someone else's older, well-managed card can add that account's history to your report.

When to use it. When you have a thin file and a trusted person with a long, on-time, low-balance card.

1. Ask only someone you trust who pays on time and keeps balances low.
2. Confirm the issuer reports authorized users to the bureaus.
3. You do not need to use the card, and you do not need the card number. Keep it that way.
4. Watch your report to see whether it appears.

Checklist

• The card has a long history and on-time payments
• The balance is low compared to the limit
• The issuer reports authorized users

Utilization timing: statement date versus due date

What it is. Credit utilization is how much of your limit you are using. The balance on your statement closing date is usually what gets reported.

When to use it. Before you apply for credit, or when you want your reported balances lower.

1. Find each card's statement closing date (it is not the same as the payment due date).
2. Pay down the balance a few days before the statement closes so a lower balance is reported.
3. Still pay the full statement balance by the due date so you do not owe interest or a late fee.
4. Aim to keep both single-card and overall utilization low.

Checklist

• I know each card's statement closing date
• I paid down before it closed
• I still paid the statement balance by the due date

Building credit

What it is. You can add positive history through tools made for it.

When to use it. When you have little or no credit, or you are rebuilding after damage.

1. Secured card: you put down a deposit that becomes your limit. Use it lightly and pay in full.
2. Credit-builder loan: payments are reported and the money is released to you at the end. Confirm it reports to all three bureaus.
3. Rent and utility reporting: some services report on-time rent or utility payments. Only some scoring models use them, and many lenders do not.
4. Boost-type tools can add utility, phone, or streaming payments to a report. FICO 8 and some models count them. Many lenders use scores that do not.
5. Keep every account open, current, and low-balance.

Checklist

• Chose a product that reports to the bureaus
• Checked fees and the interest rate
• Set up autopay for the minimum
• Watched the account show up on my report

Rapid rescoring

What it is. A rapid rescore is a quick report update that a mortgage lender can request after you fix or pay something, so your score reflects it before your loan is priced.

When to use it. During a mortgage application, when a recent correction or payoff could change your rate or approval.

1. Tell your mortgage loan officer what changed and get proof, such as a paid-in-full letter.
2. Ask whether a rapid rescore makes sense for your file.
3. The lender submits the proof to the bureaus. You cannot request it yourself.

Checklist

• I have written proof of the change
• I asked my loan officer if a rapid rescore applies

Credit freezes and fraud alerts

What it is. Both protect you from new-account fraud, in different ways.

When to use it. A freeze for steady protection. A fraud alert when you suspect fraud or after a data breach.

1. Freeze: locks your file so new creditors cannot see it. It is free by federal law since September 2018 (15 U.S.C. 1681c-1). Place it with each of the three bureaus.
2. You can lift it temporarily when you apply for credit, then freeze it again. A freeze does not affect your score.
3. Initial fraud alert: lasts one year. Businesses must take steps to verify who you are. Contact one bureau and it tells the others.
4. Extended fraud alert: lasts seven years and needs an identity theft report.

Checklist

• Froze my file at all three bureaus
• Saved the PINs or logins in a safe place
• I know how to lift and re-freeze

Identity theft recovery

What it is. If someone opened accounts in your name, you can report it and have the false information blocked.

When to use it. When you see accounts, inquiries, or addresses you do not recognize.

1. Report it at IdentityTheft.gov to get an FTC report and a personal recovery plan.
2. A police report is optional in many cases, but some creditors ask for one.
3. Send the bureaus your FTC report, proof of identity, and the list of fraudulent items to ask for a block under 15 U.S.C. 1681c-2.
4. Place a fraud alert or freeze, and contact each company where fraud occurred.
5. Keep copies of everything and watch your reports closely.

Checklist

• Filed at IdentityTheft.gov
• Placed a freeze or fraud alert
• Sent a block request with the FTC report and ID
• Called each affected creditor

Avoiding credit repair scams

What it is. The Credit Repair Organizations Act (CROA, 15 U.S.C. 1679 to 1679j) protects you from deceptive credit repair companies.

When to use it. Before you pay anyone to help with your credit.

1. A credit repair company cannot charge you before the service is fully performed.
2. You must get a written contract that spells out services, cost, and timing, and you have 3 business days to cancel.
3. Walk away from anyone who promises to remove accurate negative items, guarantees a score, or tells you to dispute everything.
4. Never create a new identity, use a credit privacy number (CPN), or use a different Social Security number or employer ID. This is illegal.
5. Never dispute accurate items falsely, even if someone tells you to.

Checklist

• Nothing was paid up front before work was done
• I have a written contract
• I know my 3 business day right to cancel
• The offer does not involve a new identity

Score factors in brief

What it is. Five factors drive a FICO score: payment history, amounts owed (including utilization), length of credit history, new credit, and credit mix.

When to use it. When you want to know where to put your effort.

1. Pay every bill on time. Payment history is the biggest factor.
2. Keep balances low compared to your limits.
3. Keep older accounts open.
4. Apply only when you need credit.
5. See the full breakdown in scores explained.

Mistakes that cost points

• Closing your oldest card, which can shorten your history and lower your available credit.
• Maxing out cards before the statement date.
• Applying for many accounts in a short time.
• Paying a collection before you know the statute of limitations.
• Missing a payment, even by a few days past 30.