Do Credit Repair Agencies Really Work?

Are the Credit Repair Agencies as Effective as They Claim to Be?

One suffers in many spheres of life from bad credit. Regarding credit history, apartment hunting, or even a job, it might create further challenges. This is the reason some individuals turn to credit repair companies to improve their credit ratings. Still, do these services carry out their expected purposes? The following is what you should be aware of about credit repair companies and if they can raise your credit score.

Credit repair companies refer to companies whose objectives are to correct customers' negative credit records.

Credit repair firms examine your credit records produced by Equifax, TransUnion, and Experian—the three major credit reference organizations. They hunt for negative material that could be false, irrelevant, or misleading in general. This may include late payments, charge-offs, collections, accounts in collection, bankruptcies, repossessions, foreclosures, and so on. To contest these negative records for you, the credit repair service subsequently writes to your creditors and the credit reference bureaus.

This is done by disputing the negative items on your credit reports and making it the responsibility of the creditor or the credit bureaus to prove that everything they posted is true, valid, and up to date. Therefore, by eliminating the negative entries from your credit report, your credit scores are likely to rise as fewer negative findings are pulling down your scores.

Do They Work?

There exists evidence that negative information can be wiped out from credit reports by credit repair agencies boosting credit scores. However, there are no assurances this will occur. You have 30 days to respond to a dispute at the credit bureau level in case of an item. If they cannot tap on the accuracy of an item with your creditor, then they are required to delete that negative item on your credit report through the provisions highlighted in the Fair Credit Reporting Act.

However, creditors and bureaus do not just rely on words from a credit repair agency that these particular items should be deleted. Creditors may also forward the negative marks to the bureaus within the 30-day window hence the information remains reflected on your credit reports.

These verifications often favor creditors and credit bureaus, rather than the consumer. Another research conducted by the Federal Trade Commission revealed that out of all the disputed charges by credit repair efforts, only between 1 to 3 percent were deleted or modified.

The Credit Repair Organizations Act also prohibits credit repair agencies from making false statements about what they are legally capable of doing to delete negative items on a credit report they are aware of or should be aware cannot be deleted. This involves requesting a credit bureau to change accurate, timely negative information that is adverse to the consumer. The only thing that a credit repair agency is capable of doing is to dispute and wait for as many as possible to be removed so that you can regain your credit score.

Is it wise to hire a credit repair company?

Major improvements to credit are typically not the norm for credit repair agencies because they are often run in such a way that the odds are not in their favor. Thus, whether they can help or not depends a lot on your particular credit situation. Credit repair is of little assistance if you have many delayed payments, defaults, unpaid debts, or other challenges. This major damage will not likely be taken out and is effective in illustrating how the conventions of Hollywood films made during the Golden Age are still present today.

However, if your negative information is mostly insignificant – a couple of late payments scattered across the years, credit repair can try to get these deleted by arguing that they are erroneous. Such less serious negative information is more likely to drop off credit reports. Such a slight shift could send credit scores much higher up the ranges, just from those few alterations above. Thus, credit repair can be most effective for those with minor credit problems.

Another advantage that credit repair agencies offer is convenience. What you do is effectively delegate the credit repair dispute process to a third party. The disadvantage of this, however, is cost. Some credit repair companies demand an upfront fee for their services besides the regular monthly charges. This gets expensive quickly. Also, everything that a credit repair agency can do can be done independently for free instead of paying them.

You have all the same dispute rights under the Fair Credit Reporting Act. Therefore, if you can dedicate your time and effort towards the process of credit repair, which might take quite some time, you might not need to pay for a credit repair agency.

The other option that is available to people is not to deal with credit repair agencies.

There are a few alternatives to consider as well if you have bad credit.

• Credit counseling - Non-profit credit counseling firms can assist in negotiating on your behalf with your creditors for lower interest rates or minimum repayment amounts. This can assist to render the debt more easy to handle. They also provide financial literacy services.
• DIY credit repair – it is possible for you to dispute information that is incorrect or unprovable on your own for free through each credit bureau’s dispute mechanism.
• Debt consolidation – These are debt consolidation loans, or balance transfer credit cards that enable you to combine several expensive debts into one account with a lower interest rate to minimize minimum payments.
• Payment history – This is one of the most important determinants of credit scores, which is a direct result of good time and credit habits. In case your credit report is poor because of several missed payments, then the passage of time, along with a consistent payment of all your bills on time, will help to rebuild your credit scores.
• Thus, in conclusion – credit repair services might indeed be useful in some cases, however, in most cases, there are free or more effective ways to repair bad credit on your own. Do not be deceived by any promises made by credit repair agencies since erasing serious negative entries is practically impossible.

Ready to boost your credit score? Call +1 888-804-0104 now for the best credit repair services near you! Our expert team is here to help you achieve financial freedom and improve your credit. Don't wait—get started today!