Proper Expectations

Truth be told, credit restoration is the most effective way to remove negative items from your credit report and increase your credit scores. It can take you from being stuck in your apartment for the next 7 years to getting your dream house with monthly payments that nearly match those of your old apartment.

Removing 100% of your negative items from all 3 CRAs is not impossible; however, it is rare and frankly, an unrealistic expectation. On average, you can expect at least 40%-60% of your negative items to be removed from your credit report within the first 4-6 months, with the best results occurring after the first two dispute letters. After the first few dispute letters, the CRAs may begin sending form letters stating that they have 'previously investigated' your disputed accounts. At this point you should continue to send dispute letters and although you may still experience great results, you probably won't.

Because the CRAs consider dispute letters with more than 15 items as frivolous, a consumer with more than 30 negative items may need a whole year to achieve the best results. With more negative items, you may not experience as drastic of a change in your credit score compared to someone who started out with only a few negative items.

At times, getting your credit score up those extra points may seem like an eternity, and you may feel that the CRAs are personally trying to make your credit restoration experience a living nightmare. Don't worry, you are not the only one who faces adversity from the CRAs and thankfully, there is a light at the tunnel's end. Think of the credit restoration process as a game of blackjack in Las Vegas. Each are systems, where in this case, the dealer is comparative to a CRA. The dealer is based on a system that plays the odds, never trying to personally outplay each opponent. The dealer can be beaten and so can the CRA. For this reason you must not become frustrated when the CRAs ignore your dispute letter. Instead, another dispute letter should be sent and you know that you are dealing with a senseless, systematic corporation.

Impacts of Improving Your Credit Score

Another favorable aspect of credit restoration is that once a CRA deletes an item from your credit report, your credit score increases immediately. In the section "What is Credit Restoration" we learned about the value of credit worthiness and the cost of bad credit. As your credit scores increase, you will increase your credit worthiness, which affects some of the most important things in life: financing, insurance, and employment opportunities. A poor credit score can also cost you thousands of dollars. There is no better time to start credit restoration and get your life back on track.

Other Factors That Affect Your Score

Notwithstanding you can expect great results from credit restoration, your credit score considers more than just your negative items. Along with deleting negative items, you will need to maintain a good utilization ratio on your revolving accounts, establish positive trade lines and recent payment history, and properly handle collections, charge-offs, and judgments.

The Importance of Positive vs. Negative Items

As previously discussed, the ratio of positive items to negative can have a major impact on your credit score. If your credit report has a lot of derogatory accounts and few positive accounts, this presents a lopsided report and makes it difficult to increase credit scores. In this case, removing derogatory items and adding more positive reporting accounts is needed to make a significant score improvement.

For example, say you have 20 derogatory items and 1 positive reporting account - and with credit restoration, 12 derogatory items are removed from the credit report - you will see a slight score improvement, but you will still have 8 negative items in comparison to 1 positive item. By opening 2 more accounts, you will change this ratio and increase your score dramatically.

If needed, we regularly recommend that people look into getting a secured credit card and small consumer finance loans to add positive reporting accounts. See the section "How to Establish New Accounts" for more details. You should strive for having 4 or more open trade lines at any one time.

Look at your credit score as a measurement of your ability to make payments on time, primarily during the last 12-24 months. This is why people that have only old or no credit history, even though they may have no derogatory items reporting, have a low or even NO credit score. In addition to reducing the number of derogatory items on your credit report, you will have a higher credit score if you have...

...more positive, currently reporting accounts

...more account types, such as installment, revolving, and mortgage

...a longer track record on these accounts

Disclaimer: The information provided in this site is not legal advice. All information is general information, some of which pertains to legal issues involved in the subject matter. Credit Matters Inc. is not a law firm and is not a substitute for an attorney or law firm. Your access to and use of this site is subject to additional terms and conditions.

All Rights Reserved.