Credit Repair: How Long Does Credit Repair Take?

An estimated time frame for clearing bad credit such bankruptcy and steps you can take to improve or maintain your good credit and set up a realistic budget.

If you are looking for a quick fix to your bad credit read no further. Real credit repair is hard work, time consuming, and an ongoing affair. For whatever reason your credit needs fixing, be it a divorce, bad personal decisions, loss of job, or any other of a hundred and one reasons, it can be accomplished, but with time and effort. How much time? Seven years on average for most bad debt situations, excluding instances where a bankruptcy is filed. When a bankruptcy is introduced into your credit file, it will stay put for an average of ten years! Those lengths of time in reality are longer. They start from the time the information was listed or filed, not from when the debt occurred.

Disputed Information in Your Credit Report:

Your first defense in cleaning up your credit file should be to know what is in it. The three major credit-reporting agencies are Equifax, Experian and Trans Union. If you have recently been denied credit, you may be entitled to a copy from the reporting agency free. Laws are also under way to ensure everyone has the right to a free combined report yearly. For now, a copy of each can be purchased from the individual agencies for a nominal fee. Once you have the reports, go over them carefully. If you notice any errors, file a dispute report. Information from each company will be included with the reports on how to file. Transunion offers convenient web access to file a dispute instantly. Be aware that when a dispute is in progress it is best not to apply for any new credit. Most disputes will be resolved within thirty days. A note of caution: Be sure to only dispute actual discrepancies. Frivolous disputes are not treated lightly.

What Can You Dispute:

All errors. For example, upon recently applying for a car loan, I was denied. I had what I thought was good credit. Upon receiving a copy of my credit report, imagine my surprise when it came and showed active accounts for not only my current mortgage, but a duplicate for the same"¦My bank had recently been acquired by a larger bank. Account numbers were changed, but no one notified the credit agencies that the old loan numbers were closed. It looked as if I was paying for two houses on my relatively modest income. The same for an overdraft account on a checking account through the same bank, and what was actually a checkbook balance to the good, showed as a loan. We still have not actually figured that out, but it was removed successfully from my credit report.


The Federal Trade Commission can offer additional assistance to consumers who believe they are not being treated fairly.


Assess how you got where you did. Be honest with yourself if there is any doubt about how you have arrived where you are. If the reason for your bad credit is a one-time life occurrence, such as the death of a spouse who was under insured and the main breadwinner for instance, the outlook may be bleak, but probably not as bad as you think. If you have a tendency to buy first and think later about how you are going to pay for that must-have purchase, take an honest look at how these "˜purchases' affect your life.


Oftentimes, people are truly astounded when they look at how much interest costs them on a month-by-month basis. Everyone, seemingly, wants to get credit at a low rate, but even those that truly shop for the best rate they can qualify for, often do not look at the actual cost their credit costs them from month to month. Pull out your statements and look at the bottom line: How much of your payment went towards the principal? How much went towards the interest? Quit a shocker, isn't it? This is the fastest way to explain why it is necessary to pay as much as you can afford on any money owed. For every dollar paid towards the principal amount owed, it will be that much more, additional interest saved.

Keeping Out of Debt:

Once you have found the edge of your debt and crawled over it, keeping from falling back in, can be as hard, or harder, than it was to get out. You suddenly feel rich, like all the burdens of the financial world you call life, have been lifted. Stay strong, be realistic, and make a list. A list? That's right, a list of goals, wants, needs, etc., along with a budget, will give you hard insight into what and where your money needs to be spent on. If you are not by nature a list maker, you may scoff at this, but try it. Pick up a notebook from the local dollar store, and within its pages; map out a budget. Start with the basics, such as mortgage/rent, insurance, utilities, vehicle expenses, including car payments, insurance, and gasoline, and don't overlook groceries, annual bills such as tax payments, or visits to the vet for your dog or cat's yearly shots. Be generous when you mark down what you spend on each item, do not mark less, thinking you can get away with spending $50 a week on groceries, when you know you currently spend at least twice that much. You may be able to spend only the $50, but at this point, we want the "˜big' outlook of your spending.

Next, make a list of things you would truly like to purchase in the next year or two. Also, make a note of how much you spend on holiday shopping, and other gift giving, such as birthdays for both family and friends. This list may grow in the coming days, as you remember this one or that, but do not worry, that is why we are making the list. Often overlooked when making a list such as this, but that should be a priority, are two items: Savings and fun money. If you tell yourself that you are going to put away a set amount off the top of each check for savings and do it, after a learning curve, you truly will not miss it. It may hurt at first, but once you see that amount grow, it can actually be a bit addictive and you will find yourself trying to save a few dollars extra here and there. The fun money is just as needed, even if it is only $5 a pay period. You work for the money. Do not begrudge yourself a favorite magazine or a couple of lottery tickets, if you truly obtain pleasure from purchasing them. Now, once you have down all the expenses you can possibly think of, write down what your earnings are. If the bottom line does not meet what your expenses are, see if you can trim your expenses anywhere. Be realistic; remember you do have to eat! If the figures do not add up, and you have cut everything you can, think about ways to increase your income. A second job, a possible raise, selling a few possessions, even a stay at home spouse taking on a part time job. A few final words: Keep a perspective of your spending. It is only money and it will only do what you allow it to do.

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