Do Credit Repair Companies Work?
You’ve probably seen ads for companies offering to repair your credit, remove negative items from your credit report, and boost your credit score (perhaps some on this very site).
But “do credit repair companies work?” I guess that all depends on what you mean by work, and what exactly you need repaired.
As I mentioned, credit repair companies offer a number of services, though they all pretty much overlap.
If they offer the removal of negative items on your credit report, this will simultaneously boost your credit score, so the part affects the whole.
Most credit repair companies basically work on your behalf, performing duties you could potentially do on your own if you had the time and know-how.
Essentially, they review copies of your credit report, determine what is weighing you down, and then send off the dispute letters.
An investigation then takes place to determine if the perhaps erroneous information is in fact erroneous, and if it is, the credit bureaus will update their information and send updated credit reports to you.
If information has changed, credit scores will also change, likely upwards reflecting the removal of potentially negative information like late payments, collections or even chargeoffs.
Unfortunately, the ultimate success of these credit repair companies can vary widely, based on what you want/need removed from your credit report.
Some creditors may fail to respond to dispute letters, spelling success for you and your credit score, while others may verify the negative information and set you back.
Sure, some credit repair companies may put up more of a fight, write more convincing letters, and spend more time on your file, but in the end there’s no guarantee, unless the company by chance offers one.
For this reason, be sure to read the terms and conditions of credit repair companies carefully to see what exactly is being offered and at what price.
Some may charge a one-off fee for certain services, while others may offer the service at an ongoing monthly cost; that can add up if you get into a lengthy fight with multiple creditors.
Perhaps a more cost efficient way of repairing your credit is to use the online credit dispute services offered by the individual credit bureaus on their websites.
The negatives of the do-it-yourself method include the time/confusion of the process and unexpected costs (the bureaus are good at selling you their services as you navigate their seemingly free websites).
Another method is to use credit monitoring services, which often include measures to dispute negative items on your credit report.
While there is a fee for these services, it’s typically included in the overall monthly subscription price, which could be cheaper than using a credit repair company.
If you order a so-called free credit report, you may be able to dispute information, though it can take time and will likely result in monthly subscription costs.
Of course, all of these methods take time, so don’t expect a miracle overnight or even within a month.
Related Topics:
- Remove Negative Items from Credit History
- Free Credit Report vs. Credit Monitoring
- What Is a Bad Credit Score?
- Free Credit Report
- Contacting the Credit Bureaus
Posted Under: Credit Help and Tips