Should You Use A Credit Repair Company?

credit repairCredit repair may be something on your mind if you suffer from poor credit.  In today’s society, credit is crucial to your financial health. Therefore, it is essential that you have knowledge surrounding this very important financial aspect of life. If someone has poor credit, they will pay more in interest over the lifetime of any loan. Bad credit can even keep you from getting a job or renting an apartment.  If you are in need of help when it comes to repairing your credit, you might want to reach out to a credit repair company.

What is a Credit Repair Company?

A credit repair company is a service that will dispute credit report inaccuracies with the credit bureaus on your behalf.  These companies have skilled credit repair specialists that have been trained to help customers repair their credit score and in turn improve their way of living. They can analyze your problem areas and tailor a resolution plan that can help you reach your goals and prosper. The initial consultation is usually free and can give you insight as to what will need to be done in order to repair your credit.

 

What will a credit repair company do for me?

Credit repair companies such as Lexington Law will pull your credit from each of the three major credit bureaus (EquifaxExperian, and TransUnion). These reports will give the credit repair specialist a more in-depth look at where your credit issues lie. Together you will help them determine any inaccuracies on your report.  If there is an item that is not accurate and verifiable, they will look to have it removed from your report.  With that being said, any items that are verifiable cannot be removed from your report.  Some of the things that credit repair companies can challenge for you are:

  • Bankruptcies
  • Late payments
  • Judgements
  • Debt collections
  • Charge offs
  • Repossessions
  • Foreclosures

After having the free consultation, the credit repair specialist will ask if you would like help disputing these issues. The monthly fee will then be discussed in order to move forward.

How much does credit repair cost?

The cost varies by company and also by the level of service you go with.  Most companies will charge a monthly fee but some do flat rates or charge per inaccuracy found.  In addition, the Credit Repair Organizations Act states that credit repair companies cannot collect payment from a customer until promised results are delivered.  The monthly fee will vary by company but if the cost is concerning, keep in mind that repairing your credit will save you loads of money down the road.

How to choose a reputable company

When you start out looking for a credit repair company, you need to know the right questions to ask.  You also want to find reviews and understand what the credit process can and can’t do for you.  By doing your due diligence before hand, you will save yourself time, money and unnecessary stress.

Here is what to be aware of:

  • Do not go with a company that demands payment up-front.  This is illegal.
  • They are making promises as to what they will be able to remove from your report.  If a company guarantees anything, they are illegitimate.
  • The company can’t provide you with answers to your questions.
  • They are not forthcoming with information.  Pro tip: you have the right to cancel your contract with any company within three business days.
  • You are asked to misreport or otherwise misrepresent yourself.