When you struggle to qualify for personal loans, mortgage or even credit cards, it means you have bad credit. This makes you the perfect candidate for credit repair companies that dedicate their expertise towards improving your credibility in return for a fee.
When you weigh the worth of your time against the worth of your money, you may find that hiring professional assistance for improving your financial record fares well for you. Not to mention, a smooth, disciplined process increases the chances of you sticking around till the very end of problem solving as opposed to giving up when faced with uncertainties. Disputing credit discrepancies or finding open avenues to get started are matters that may require a broad understanding of how credit bureaus work to determine any improvement on your part. This is where a credit repair company comes in and employs its skills effectively.
What is a Credit Repair Company?
A credit repair company is an organization led by professionals who help you repair your credit by thoroughly inspecting your credit report for inaccuracies, disputing them and ultimately seeking available routes to boost your credit status.
Credit repair companies have the experience and skills necessary to recognize any errors possibly made by credit bureaus. They also have the knowledge to address and resolve them. Tackling credit issues simplifies the repair process significantly and also saves you from paying interest on faulty charges. Furthermore, these companies are well versed in your rights as a debtor in relation to your creditors and credit bureaus, including legal entitlement which you may not be aware of at all. This crucial information can benefit you all the more by easing your credit recovery process.
A credit repair company should not be confused with a credit counseling agency, which serves the purpose of counseling by advising and reinforcing ideas about debt and finance management. A credit repair company actually acts like an intermediary between you and the credit bureaus. The professionals represent your case and communicate effectively on your behalf. In addition, by using their tactful experience they can effectively raise the chances of this cooperation to bear fruit.
How Does a Credit Repair Company Work?
A credit repair company reviews your credit reports to scrutinize inaccuracies and establish avenues for you to progress and improve your credit score.
The company does this by extracting your credit report from the three credit bureaus Equifax, Experian, and TransUnion and identify potential mistakes like wrongly attributed accounts, incorrect inquiries, and incorrectly lodged information. This being a thoroughly detailed process, which involves the verification of duplicate accounts and expired negative items, tends to take up a few days. Once the information has been analyzed, the team uses it to support any disputes that they lodge. This is done by submitting documentation to the three bureaus and coordinating with them to establish if these errors can be eliminated from your credit report.
Reports collected from banks, loan organizations, credit unions and mortgage givers are collected and processed in three categories, each detailing separate information. Each of the three major credit bureaus individually source these three reports, which means companies working to repair credit are thoroughly reading through a substantial amount of data. This can be overwhelming for you if you set out to do it on your own considering that your commitment may not hold up for long. Plus, there is always a chance you may not be able to recognize errors in your report or have little success in resolving/proving discrepancies to the bureaus.
How Can I Verify a Credit Repair Company?
If at any point you decide to hire a professional credit repair company, it would be important that you verify the legitimacy of that company. You can do this by ruling out the following red flags:
– Demands for payment upfront without starting the process or requiring payment for consultation
– Makes you avoid interacting with credit reporting companies yourself
– Requests you to make dubious claims in relation to the information in your credit report
– Fails to go over your legal rights while briefing their services to you
If you recognize any of these indicators, it is important that you cancel any dealings with them and report them to the State Attorney General or the Federal Trade Commission.
How Much Does Credit Repair Cost?
The costs for repairing your credit through a professional team varies company to company. The fee may also be determined by the level of service you choose as some services may employ a simpler criteria while others may use a more stringent and time consuming criteria. The payment may be made in series at certain stages during the process. However, in accordance with the law full payment cannot be demanded by companies until they deliver according to their promises.
How Long Does Credit Repair Take?
The time taken to repair credit mainly depends on your credit score, financial standing and other factors like the number of discrepancies and the complexity of your case. If you have fewer errors to report, you’re likely to see progress/results sooner. Typically, the credit bureaus are required to remove any proven discrepancies reported to them within 30 days (as per Fair Credit Reporting Act).
Can I Repair My Own Credit?
You can certainly repair your credit on your own, considering the fact that you are entitled to access any information regarding your credit history. However, the complexity involved in analyzing, collecting and effectively communicating errors to credit reporters can discourage you from staying committed to this activity.
Can a Credit Repair Company Really Help Me?
Although a credit repair company cannot guarantee results, its likelihood of delivering positive results can be determined by its overall standing (check reviews and testimonials). A genuinely dedicated company will recommend ways to maintain a good standing with regards to debt payment and other delinquencies. It would comprehensively analyze all credit aspects and simplify the steps you must take to improve your score.
It is also worth understanding that creditors are willing to cooperate with their debtors and hence any cooperation genuinely offered to them is likely to be fruitful. The main task is to eliminate hurdles and ease the credit recovery route as much as you can, which reputable credit repair companies are best experienced in doing.
Ultimately, if you look at things from a practical point of view you’ll understand that a poor credit score translates to higher interest rates and lower chances of eligibility for ownership or establishment. This means you may never get around to clearing up your records and starting fresh if you don’t seriously dedicate yourself to it as soon as you can. An improved credit score saves you from potentially losing thousands in the long run and you could do this by nominally investing in professionals who can steer you in the right direction.