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How Does Credit Repair Work?

Written by Mike Pearson
Updated September 23, 2022

In A Nutshell

Credit repair usually refers to companies that help consumers get negative items removed from their credit reports. If you don’t have the budget to pay for a credit repair service, you can use DIY credit repair strategies to fix your credit without a fee. 

What Is Credit Repair?

Credit repair is the process of getting negative and derogatory items removed from your credit report in an effort to improve your credit score. It’s possible to do this entirely on your own without spending any money.

Because repairing your credit typically means disputing negative items with the credit bureaus and sometimes creditors, however, many people choose to hire a credit repair company to submit disputes on their behalf. This method of credit repair can be highly successful, but it isn’t free.

In general, a credit repair company uses the same strategies as someone doing DIY credit repair. However, credit repair companies have a lot more resources and usually more experience, which means they can often produce faster results. 

The cost of credit repair services varies, but you should expect to pay somewhere around $100 per month, and many credit repair companies say it takes about six months or so to see results. 

If that’s not in your budget, no worries. It’s possible to repair your credit without outsourcing it to a professional service. 

How Does Credit Repair Work?

Whether you go the DIY route or hire a company, the credit repair process works in much the same way. 

1. Get your credit reports 

The first step is to get your credit report from all three major credit bureaus: Equifax, Experian, and TransUnion. You’ll want to get all three, as each report might contain slightly different information, and some negative items might appear on one report but not on the others.

By law, you’re entitled to one free credit report from all three bureaus once every 12 months. If you’re doing credit repair on your own, you can get your free report by visiting

If you work with a credit repair company, they might walk you through the process for requesting your reports, and the company will need them to start the credit repair process. Depending on the company, they might also ask you to sign up for credit monitoring so they can flag any negative items that post after they start working on your file. 

2. Review your reports

Once you have your reports from all three bureaus, you should read your credit reports thoroughly and highlight any negative items, including charge-offs, late payments, bankruptcies, or liens. You should also look for errors, such as a misspelling in your name, incorrect dates, or accounts that don’t belong to you. 

A credit repair company will follow the same process, and many will assign you a service representative or credit repair professional to help you go through your report and spot any issues.

3. Dispute negative items   

After you’ve identified negative items or mistakes, you should dispute them with the credit bureaus. This can involve sending a dispute letter, mailing a cease and desist letter to a debt collector, or requesting that a creditor validate a debt. 

4. Rebuild your credit

Once you’ve done everything you can to remove negative items from your credit report, you can turn to strategies for rebuilding your credit. 

There are a number of things you can do to boost your credit score and continue improving your credit, including:

  • Becoming an authorized user on someone else’s credit card
  • Taking out a credit-builder loan
  • Opening a store credit card
  • Piggybacking on another person’s good credit
  • Getting a secured credit card

Rebuilding your credit can take some time, but it can also be a rewarding process. If you’re patient and willing to stick with it, you can watch your credit score improve month after month.  

Are There Legitimate Credit Repair Companies?

While it’s possible to repair your credit totally on your own, not everyone has the time or patience to see the process through from start to finish. If you’d rather hire a pro, there are several reputable credit repair companies to choose from. 

1. Credit Saint

Credit Saint has an A+ rating with the Better Business Bureau (BBB), which sets it apart from many of its competitors. It’s also been around since 2004, so you can rest easy knowing it has over a decade of experience in the credit repair industry. 

There are three packages to choose from, and each package comes with a free consult and a 90-day money-back guarantee if you’re not satisfied with the service. 

The Credit Polish package is the cheapest at $99 to enroll and a monthly fee of $79.99. This level of service gets you the most challenges, but Credit Saint won’t dispute bankruptcies, repossessions, or judgments at this level. 

The next level up is the Credit Remodel package, which costs $99 to sign up and $99.99 each month thereafter. With this package, Credit Saint will challenge bankruptcies and repossessions

The most expensive package is the Clean Slate, which costs $195 to sign up and $119.99 each month. With this level, you receive all of Credit Saint‘s services. 

2. Sky Blue Credit

Founded in 1989, Sky Blue Credit is one of the oldest existing credit repair companies in the industry. It also offers a transparent, flat-fee pricing structure that’s easy to understand. 

With Sky Blue, you pay $79 each month, with your first payment due six days after you sign up for services. On its website, Sky Blue says it disputes 15 negative items every 35 days. 

The monthly fee for Sky Blue’s services is always $79, and you can pause your account at any time without incurring a penalty. You can also cancel whenever you wish without extra costs.

3. The Credit People

The Credit People, which has been in business since 2001, has a two-tier pricing structure. You can choose to pay monthly for as long as you use the service, or you can opt for a one-time flat fee. 

If you go for the monthly plan, it costs $19 to enroll and $79 each month for as long as you use The Credit People‘s services.

The flat-fee pay is a one-time payment of $419, which gets you six months of services. With the flat-fee plan, everything is inclusive, so you don’t pay a signup fee or a monthly charge. 

Like other credit repair companies, The Credit People can’t make any guarantees about results. However, it says its customers generally see their credit scores improve anywhere from 50 to 180 points.

4. Lexington Law

Lexington Law is a real law firm staffed by lawyers, paralegals, and credit repair professionals. It got its start as a traditional law firm in 1991 and then focused almost exclusively on credit repair starting in 2004. 

The firm lets customers choose from three packages: Concord Standard, Concord Premier, and Premier Plus. 

The most affordable plan is the Concord Plus, which costs $89.95 a month. With this plan, Lexington Law will dispute negative items on your credit report. 

The Concord Premier is the middle-of-the-road plan. It costs $109.95 a month and comes with everything in the Concord Plus plan as well as credit score analysis and TransUnion credit alerts.

The Premier Plus is the most expensive plan at $129.95 per month. This plan gets you everything from the two lower tiers plus credit score monitoring, identity theft protection, and access to money management tools. 

If you’re considering Lexington Law, you should be aware that the Consumer Financial Protection Financial Bureau (CFPB) took legal action against the company in 2019 for alleged deceptive practices. The complaint, along with a brief explainer, is available on the CFPB website here

5. Ovation Credit Repair Services 

Ovation Credit Repair Services offers two levels of credit repair services. Both packages require an $89 enrollment fee to get started. 

The Essentials package costs $79 per month and comes with access to a case advisor who walks you through your credit report and flags negative items. From there, Ovation sends dispute letters in an effort to get negative items removed from your credit report. 

The Essentials Plus package is $109 per month and includes everything in the Essentials plan, along with unlimited goodwill letters and unlimited dispute letters.

Unlike most credit repair companies, Ovation doesn’t offer an option to enroll online. Instead, you have to give them a call at 866-639-3426.

8 Steps to Repairing Your Credit

Repairing your credit takes time, but the results are worth it. Here’s a quick guide to some steps you can take to rehab a bad credit score. 

1. Read your credit reports

Get your credit reports from Experian, Equifax, and TransUnion and read through each one. Look for any negative items, such as late payments, collections, or charge-offs. 

2. Dispute negative items 

Dispute any negative items you find on your credit reports. Believe it or not, you can do this in just two easy steps, which you can find in this explainer.  

Even if you think a negative item is accurate, it’s still worth asking the original creditor to verify it, which they’re required to do by federal law. 

If a creditor can’t verify a debt, they must remove it from your credit report. If a debt is very old or it’s been sold to a collection agency, the creditor might not be able to properly verify it, which could work out in your favor.

3. Ask creditors to delete negative items

If you can’t get a negative item removed by disputing it, you can try to ask your creditors to delete a debt or negative entry on your credit report. In some cases, they’ll do this as a goodwill gesture or in exchange for you paying off or settling the money you owe them. 

4. Increase your credit limit

You can improve your credit score by getting access to more credit. This impacts your credit utilization, which is the ratio of how much credit you’re using versus how much total credit you have available to you.

Generally, you want to keep your credit utilization rate at or below 30 percent. You can get more credit by opening a new credit card, or you can try asking your existing credit card company to increase the limit on a card you already have.  

5. Pay down your balances

Paying down your debts can help you improve your credit score by lowering your credit utilization. It will also help you save money on interest. 

Some people use a debt “snowball” strategy to pay off debts by picking the smallest balance and focusing on paying it off. Once it’s paid off, you move to the next biggest balance, snowballing your way toward a debt-free lifestyle. 

6. Borrow someone else’s credit

If you don’t have good credit of your own, you can piggyback on someone else’s. You can do this by asking them to co-sign on a loan for you or by adding you as an authorized user on one of their credit cards. 

7. Pay your bills on time

Your payment history makes up 35 percent of your credit score, making it the single biggest factor in determining your score. By paying your bills on time each month, you can boost your score over time.

8. Open a secured credit card

One of the conundrums of the credit world is that it typically takes good credit to get credit. This can make it tough to establish new credit or rebuild from past mistakes. 

However, you can get a foothold on the journey to better credit by opening a secured credit card. You’ll have to pay a security deposit, but these cards are usually much easier for people with bad credit to get. 

Once you have your secured card, make small purchases and pay them off each month. Over time, the positive payment history will post to your credit report, boosting your score and letting you transition to an unsecured credit card down the road. 

How Long Does Credit Repair Take?

The time required for credit repair really varies depending on the person, their credit score, and what kind of negative items are pulling down their score.

In general, the dispute process takes around 30 days. If you follow all the credit repair best practices, you should start seeing improvement in your score anywhere between two and six months. 

If you want faster results, it might be worth hiring a credit repair company. While they can’t do anything you can’t do on your own, they tend to work faster because they have more resources and experience compared to the average person.   

Best Alternatives to Credit Repair

If you’ve gone through the credit dispute process but your score won’t budge, there are still things you can do to improve your score and build credit

  • Credit builder loan – With a credit builder loan, you make small monthly payments into a sort of savings account. At the end of the loan period, you receive the amount you’ve paid in a lump sum plus any interest. 
  • Secured credit card – A secured credit card requires small down payment upfront, but these cards are fairly easy to get even if you have bad credit. Most secured cards come with a limited credit line, however, many offer increases if you use your card responsibly
  • Authorized user – If bad credit is holding you back, you can borrow someone else’s by having them add you to their account as an authorized user. If you go this route, just make sure the credit card lender reports authorized user activity to the credit bureaus. 

Credit Repair FAQs

The following are some of the most commonly asked questions and answers about credit repair. 

Can a credit repair company really help?

A credit repair company may be able to help you get negative items removed from your credit report, which will improve your credit score. However, credit repair companies aren’t a magic bullet, and they can’t make any guarantees.

Furthermore, credit repair companies can’t do anything for you that you can’t do on your own for free. However, they have expertise in credit repair, which means they can sometimes produce faster results. 

How much does credit repair cost?

If you do credit repair on your own, there is no cost save for the few dollars you might spend on postage and certified mail. If you hire a credit repair company, costs vary, with most averaging around $100 a month. 

How can I repair my credit myself?

The good news is you can repair your credit by yourself without spending anything. Here’s a guide to 5 credit-building strategies you can do on your own for free.   


Credit repair can be a time-consuming process, but the results are worth it. Whether you hire a credit repair company or tackle it on your own, improving your credit can help you save money, build wealth, and eventually achieve a debt-free lifestyle. 


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Mike Pearson

Mike is a recognized credit expert and founder of Credit Takeoff. His credit advice has been featured in Investopedia,, Bankrate, Huffpost, The Simple Dollar, Reader's Digest, LendingTree, and Quickbooks. Read more.