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Bad Credit Repair Companies?

How To Fix Your Credit Report & Improve FICO Scores

money mattersLet's be direct, the financial landscape is littered with credit repair companies making bold claims that they can improve your credit score and rebuild your fico. Judgements, liens, bankruptcies, chex system inclusion, are all declared, 'no problem,' and that these companies provide guaranteed results to get your reports cleaned with the three reporting bureaus.

 

Sounds like an enticing pitch, especially when you are faced with a bad credit history and have few financing options available to you when you need to borrow.


The first thing to note, is that any company or service that claims they can provide instant results when undertaking to rebuild your credit is most undoubtedly a scam. Unfortunately there do exist a variety of scam services in the market place relating to credit so a dose of caution will pay off interest later. Legitimate and legal repairing of credit requires time and effort.

 

So how as a consumer can you recognize a scam repair company and find a legitimate service for your credit?


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How To Recognize A Scam Repairing Company


credit repair scamUnfortunately there are a multitude of firms that target people with a bad credit score with impossible promises to instantly clean up their credit report so that the banks will again consider lending to them in order to grow their business, borrow to buy a car, or purchase a home.

 

In many cases the very strategies that these companies will employ on your behalf are illegal. You are on the hook having paid the fees and costs of working with the company only to find yourself in legal trouble with a report as bad as it was prior to your engaging the service!


Avoid any repair company that does any of the following practices:

  • If the service advises you to dispute all the items within your credit report regardless of their validity or accuracy.
  • If the company asks you to pay up front for the work they are offering to do. The Credit Repair Organizations Act states that companies in this industry cannot require up front payment.
  • If the company does not seem forthcoming with information about your rights as a consumer or provide you with detailed information as to what will be done on your behalf.
  • If the company recommends you to create a new and separate identification using an EIN or employee identification number for the sole purpose of creating a fresh credit identity.
  • If your agent is not forthcoming about what free options you have to repair your credit score.

These guidelines for selecting a repair company help you avoid a service that is unethical to downright fraudulent. Remember that as a consumer you are responsible for the actions that are done on your behalf by the company you employ and be wary to avoid any activity that can be deemed fraudulent.


Your Credit Repair Rights


consumer credit rights
The best protection for a consumer is to know your rights pertaining to your credit report. A legal and legitimate credit fixing company is effective because they have an expansive understanding of your rights and have experience in legal methods of flexing them in your behalf. Regardless, knowing your rights arms you in advance of working with a professional, empowering you to get the most for your time and money. 

 

The first secret to fixing credit is that there is no secret, anything a company can do for you to clean your report and improve your score is typically available to be done on your own for free or for a small charge. For example, you are entitled to a free credit report provided annually from the three recording bureaus, TransUnion, Equifax, and Experian.

 

They are required by law to provide you a free reporting annually upon request. You can call the reporting companies directly via a toll-free number, 1-877-322-8228, you can mail them the Annual Credit Report Request Form:


Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281


or simply visit their service website annualcreditreport.com in order to ask for it directly.  If you have already attained your credit report recently, you can acquire an updated score report for a small cost. Additionally you can get important forms for free from the ftc.gov/credit site online.

 

Another option to consider, is that if you are turned down for credit from any bank or lending institution, they are obligated to provide you your credit report they attained if you ask for it.


In addition to the free availability of your credit report, the entire process that a legitimate credit score repair company would begin on your behalf is available at low cost if you are so inclined. Disputing credit report items in order to clean negatively impacting items or innacuraccies can be done by you. A simple dispute letter is easy enough, we even provide example dispute letters on this website for free.


Upon receipt of the credit dispute letter, the consumer reporting companies are obligated by law to investigate and determine the accuracy of the disputed item within 30 days.

 

Typically they will attempt to contact the lender to verify the accuracy of the debt and its payment details and make a determination about its accuracy. This is the loophole many credit repair company scams attempt to exploit in that if the matter is not investigated within the 30 day period, or a determination can not be proven the item must be removed from your report, effectively the consumer companies must rule in your favor.


credit repair companiesWhy Use A Professional Credit Repairing Company At All?


As you can see, the entire FICO repair process is available for you to engage in if you are so motivated to do so, so what is the benefit of using a company at all? It boils down to time, organization, and experience. There are certainly benefits to hiring a credit company to help you fix your score. Beyond getting your annual credit report for free, which is quite easy, the remainder of the repair process can be frustrating and timely.

 

The truth of the matter is, though you can do it yourself, dealing with the bureaucracy of the consumer credit reporting agencies as well as tracking down the information with your various banks, lenders and other financial institutions to document your borrowing history can be a difficult process. How you phrase your credit dispute letter, lack of accepted documentation, or in some cases fraudulent collection agencies and lenders misrepresenting the truth can set back your repair efforts by months.

 

The experience of professional credit repair companies or credit law firm can be invaluable if you need to clean your credit reports without unnecessary delay. Helping people fix their reports of innacuraccies day in and day out gives them a confidence of experience as to how to proceed through the process correctly, adeptly navigating any pitfalls and ensuring that your report items are taken care of in a legal and timely manner.


Ultimately it is up to you to decide whether you would prefer to use a professional credit repair company or would like to engage in a do-it-yourself fashion. 

 

Whichever route you choose, the important factor is to take action to repair your financial house and get back in the good graces with the banks and lenders that can empower you through borrowing to take advantage of opportunities when they present themself.