By The Blog Frog
If you have (or have ever had) bad credit, then you know just how strenuous it can make your life. Something as routine as acquiring a new cell phone is hard. Stores will run a credit check before they offer you a phone whose cost you’ll repay over a period of one or two years.
More concerning, renting an apartment is a pain, and the choice of places you can live in narrows greatly. Many landlords will require a credit check to avoid getting a problematic tenant who will be difficult to evict once they’ve signed the lease agreement. Basic banking services are expensive if not out of reach to the extent that a growing number of people are turning to electronic money services like Amaiz.com.
Yet, bad credit doesn’t mean you’re a dishonest, untrustworthy, or unreliable individual. And even if you were, it doesn’t mean you cannot turn your life around and be a more upstanding member of society. Unfortunately, getting your credit back on track can be a long journey. But time isn’t something you have in plenty. You could cut the time it takes by engaging a credit repair company. Here are the things you need to know before you get in touch with one.
Defining credit repair companies
Like their name implies, credit repair companies help improve your credit score at a fee. You can of course do all this on your own. However, credit repair companies promise to do all the legwork for you, so you can focus your time on other important things in your life. They leverage the knowledge and experience gathered over the years to pick up credit report mistakes.
What credit repair companies do
The exact services offered may differ from one credit repair company to the next. That said, there are certain things you can expect from virtually every credit repair service.
They’ll start by requesting your credit report from the three main credit bureaus — e.g. TransUnion, Experian, and Equifax. The credit repair company will study the report for inaccuracies and negotiate their removal. They’ll liaise with creditors to ensure the accuracy of records.
The credit repair companies may also establish whether all hard inquiries made were accurate, so they can have those that weren’t removed. They may issue cease-and-desist letters on your behalf to debt collectors.
Cost of credit repair services
Credit repair companies recognize that the people who approach them for assistance aren’t often those with large disposable incomes. Most companies will therefore attach a reasonably affordable fee for their service.
You can expect it to cost you $50 to $130+ per month, depending on the scale and complexity of repair work you want the company to do for you. Some companies will charge you based on the negatives they get deleted successfully. This may be as low as $35 per entry to as much as $750 or more.
You’ll have access to a free consultation at the beginning, so the company can take a look at your report, see the scale of the problem, identify the opportunities, and therefore recommend the most appropriate package.
What credit repair companies cannot do
Credit repair companies provide a valuable service, but they are certainly not omnipotent. There are things that they cannot do. First, repair services will not get rid of all negative information on a credit report. If the negative entries are accurate, they’ll remain. Second, the service cannot guarantee an improvement in your credit score.
Avoiding credit repair scams
The Federal Trade Commission warns consumers to be wary of credit repair scammers. So before you work with one, confirm that they are legit and not looking to relieve you of your cash without a commensurate return in value.
Get referrals from your family and friends; check reviews on Better Business Bureau, Facebook, and Google to gauge customer satisfaction; and search the CFPB Complaint Database. Keep an eye on unrealistic targets such as promising to create a new credit identity or a request for you to pay before they’ve had a look at your credit report or initiated the repair actions.
A credit repair company can help pull your credit score from the doldrums and back on to the right path. Nevertheless, that will only happen if you are working with a reputable credit repair firm.