In the modern financial world, it is extremely challenging to navigate with bad credit scores. Companies look at your credit before deciding whether to do business with you, rent to you, or give you a loan and they are setting the prices for the products and services you use. If you are someone who has bad credit, you’ll want to know how you can fix your credit. You can fix your credit yourself, or use a credit repair company. As you go through credit repair and weigh the best credit option, the following are the vital things to know regarding credit repair.
What is a Credit Repair Company?
A credit repair company is an organization that helps consumers improve their credit at a fee. Credit repair companies collaborate with credit bureaus and creditors on behalf of the consumer to remove the credit report’s errors. While a lot of these companies are scams, we also have legitimate credit repair companies such as the Experian, TransUnion, and Equifax.
How do credit companies work?
A credit repair company works on behalf of the consumer in removing negative marks from their credit reports. To accomplish this, credit repair companies use two strategies:
- The companies can challenge the negative marks on the client’s credit report, while trying to make the credit bureaus remove them.
- The next strategy is asking the creditors to prove negative marks, failure to which the negative marks are erased.
Although reputable credit repair companies can be an option for some individuals, there is nothing that a credit repair company does for you that you cannot do by yourself. We can provide you a free copy of the dispute letters we use. You can learn how credit functions and how you can repair your credit.
Repairing your credit saves you money and also gives you control over your credit history. Once you gain the credit repair skills, you can use them anytime.
The information on your credit report influences your credit score. Therefore, the first step to repair your credit is checking your credit report to identify different things that could be hurting your credit score. The company, therefore, repairs your credit report, which in turn improves your credit score.
Looking for a good credit repair company can be challenging when you do not know what you’re looking for. So, what do you look for in a credit repair company?
What should I avoid in a credit repair company?
The modern world is flooded with fraudulent credit repair as well as credit card scams. The main target for the scammers is the people who are in a potentially vulnerable position. To avoid these scammers, you need to proceed with caution. When looking for a good credit repair company, always ensure you avoid a credit repair service that:
- Tells you to avoid making direct contact with the credit bureaus. By ensuring you are not in contact with the credit bureaus, they have more loopholes that can trick you into falling into their trap.
- Asks for a fee payment upfront before doing any work. A professional and legitimate credit repair company only asks you to pay for their services after they successfully repair your credit.
- Promises quick results or instant credit repair. The credit repair process takes a while to complete, as various procedures and formalities have to be followed before the credit is repaired. This scam is easy to trap consumers who are looking for quick results.
- Insists on disputing accurate information on your credit card. The purpose of a credit repair service provider is to erase the inaccurate credit information. It is impossible to delete accurate credit information legitimately, and any attempt to do this can land you in trouble.
- Also avoid a servicer that requests to offer you a clean slate, an alternative Social Security number, or a new identity. All of these practices, though tempting, are illegal, and you can face charges by getting involved.
- Avoid a servicer that does not explain your legal rights. A legitimate credit repair company explains your legal rights and how you can use them when repairing your credit. Understanding these rights can help you maintain a good credit score and disputing incorrect or outdated negative credit information. If a company does not explain these rights, that’s a red flag, and you need to avoid it.
- Lastly, avoid a company that advises you to provide false information. A legitimate and reputable company warns you against falsifying your information because they can have damaging consequences. However, the companies that are only after your money will advise you to lie and do not care about the consequences. They need you to lie to dispute even the correct credit information, which could land you into hot soup.
What Should I Look For In A Good Credit Repair Company?
We covered what you should avoid in finding a good credit repair company now we will go over what things you should look for when you are trying to improve your credit score.
- Do they have a Better Business Bureau (BBB) account? Most service companies have an account with the Better Business Bureau and their accounts are in good standing. Take a look to see if they have any complaints, when the complaint was and see if the company is actively trying to resolve any complaints.
- Does the company have a physical address? If the company is legit, they will most likely have an office that you can look up on google maps. If it is a small company or a single person they may not have an office and might be working out of their home but see if they have any address listed.
- Do they have good reviews? Check their reviews on Google, TrustPilot, Yelp or Angie.
- Is the business active? While it’s almost impossible to avoid any negative reviews, no matter how great a company is, when dealing with so many customers you want to know if the company is active online and responding to reviews and answering customer questions. Do they have an active Facebook page, Instagram account or Google.
- Do they have good customer service? One of the most deciding factors on choosing a service business is if they have good customer service. A good test is to call the company or leave them a Facebook message. Do they answer in a timely manner? Did they answer all your questions? How did they make you feel? An excellent company will go above and beyond to answer any questions you have and make you feel like you will be taken care of.
Can I Fix My Credit Myself?
You can absolutely fix your credit by yourself. We have created the number one DIY credit repair course that has simple and easy-to-follow steps to help you fix your credit. We have compiled years of expertise on credit and put everything we have into this course. You will learn what your actual credit score is, what makes the biggest impact on your credit score, what steps you should take in each category to improve your score, what credit cards are the best for you, how to travel for free, and how to use dispute letters to remove things from your credit report.
When Should I Use Credit Repair Services?
We all reach a point in life when we need credit repair services. However, some occasions dearly need credit repair services while others can borrow other alternatives such as DIY.
When in a financial pickle and have a very low credit score or various credit sins that stand between you and a life event or a major purchase, you can be tempted to look into using credit repair services.
In general terms, there is no harm in simply checking it out, right? Just make a simple call and have another person solve your problem for you. However, let’s face it, when did a stranger-for-hire actually solve your complex financial problem?
Be cautioned if you are considering this option. First stop and think it through. If you just jump into a credit repair company like in a swimming pool, it can be hard to extricate yourself if you think otherwise.
The truth is that you can do all they can do, and this will just cost you your time, not hundreds of dollars. Moreover, doing it yourself will not have you sign an agreement that might get you into the hot soup if you change your mind about using the credit repair services.
No matter what you might have heard, accurate information on your credit report that is not out of date can never be ‘legitimately’ erased, at least not permanently. One quick fix sometimes offered by less than reputable credit repair companies is flooding the credit bureaus with multiple fictitious disputes of your credit report’s valid information to bog down the system.
Bogging the system down can temporarily delete items from your credit report, based on the reason that the credit reporting agencies have to investigate disputes within a certain period of time. However, after the information is verified, and it will be verified eventually, the ‘deleted’ items will reappear on your credit report.
These items will eventually get back on your report, and it does not take long. You are most likely to inflict more harm than good. What is worse, if you try securing a loan or some kind of funding during the investigation of your disputes, it can be considered as fraud, and worse you can be prosecuted.
There are, however, some instances when the need to use credit repair services is wanting. However, you need to be sure that the credit repair company is reputable, as the industry is flooded with fraudsters.
How Can Credit Repair Companies Help Repair Your Credit?
The following functions are what a credit company can help you carry out:
- Challenging errors on your credit report
If you decide to do this by yourself, you will be required to send dispute letters and also sort out every dispute yourself. This practice can be time-consuming and intimidating. Depending on a reputable credit repair company in managing the process of dispute can still take time. However, you can trust that the task is being done by professionals.
You can use a credit repair company to dispute incorrect credit information, such as credit or collection accounts that are actually not yours. They do this on your behalf. Additionally, they can help in detecting less obvious errors in credit reporting that you might have missed.
- Dispute negative terms
Everything on a consumer’s credit has, according to federal law, to be verifiable. Some out-of-business creditors or those who cannot respond in a timely manner will not verify a negative item within the required response period of 30 days. In this case, you can use a credit repair service to dispute all negative items on your credit report, independent of their accuracy. If the creditor fails to respond before the end of the period, the negative item is erased from your report.
- Negotiate for a less negative credit report
If you are willing to pay or settle a past-due debt, a creditor could be willing to alter how they report your account to credit bureaus. Here, you can employ a credit repair company to handle the negotiation on your behalf. Experienced credit repair companies know how to approach various creditors and the conditions of approach and can also use more effective negotiation strategies. They can also advise you on the various factors affecting your credit scores and how you can improve.
Remember that credit repair companies do not do what you cannot do yourself. However, if you require more professional services and lack the time or knowledge to go through the process, you can hire a reputable company to help you out. They cannot erase accurate information, all they do is simplify the process for you and offer their skills in doing it.
There are hundreds of thousands of credit repair companies on the market and know that you know what to look for in a credit repair company we have compiled a list of the best credit repair companies.
Conclusively, be sure to inquire before deciding to sign up for any credit repair company. If you do not receive clear answers, then that is a red flag, and you need to avoid it. Additionally, even if it is a legitimate credit repair company, consider if it is worth paying for services that you can do by yourself.
Do you have bad credit, no credit or want to learn how to become a credit expert?
Check out our credit repair training and learn:
- What your actual credit score is
- How to get a copy of your free credit report
- How to get your credit back on track today
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