If you think of improving your credit score – to remove negative items, correct errors & mistakes, cleanup or restoration – then credit repair is for you. There is a lot of scam credit repair companies, in which making your decisions fruitless at some point. Learn about what is credit repair and what is a good credit score. Be as informed as possible.
How do I determine the best credit repair companies?
What is a good credit score? To qualify for a mortgage, credit card or loan, it’s imperative to obtain a fico credit score. If you scored below 600, it is not possible to get a mortgage loan or even an FHA-backed home loan. Find out the best credit repair companies here.
Characteristics of best 10 credit repair companies could be found in Figure 1.0 below:
Figure 1.0 Characteristics of Best 10 Credit Repair Companies
|License||Financial services license has been approved by the Federal Trade Commission (FTC) and governed by Consumer Financial Protection Bureau (CFPB).|
|Consumer rights||Issued a consumer credit repair guide stating your legal rights & other relevant information (such as payment, pricing and service).|
|Legal compliance||Mentioned credit repair laws: Credit Repair Organizations Act (CROA), Fair Credit Report Act (FCRA) and others.|
|Reputation||Duration of business operation, number of item for disputes etc.|
|Personal feeling||A sense of responsibility and comfort dealing with the agency.|
Fortunately, most credit repair companies are licensed to perform financial services for their customers. A company differs from its competitors through product offerings. Some companies specialized in raising your credit scores. Others performed quick credit fix services to boost your credit reports. It depends on your rationale for hiring an agency.
Note: Find out more about the qualities of credit repair services at Kighall.com
What does a credit repair company do?
A credit report is required to identify your problems – even removing negative information using letters of dispute – that is mandatory for your consultant. To retrieve your credit reports, it is a must to request for retrievals and this can attract a fee. Initial setup cost may be charged.
Characteristics of credit repair service could be found in Figure 2.0 below:
Figure 2.0 Characteristics of Credit Repair Service
|Case advisor||May or may not assign a case advisor, sometimes paralegal to you.|
|Credit report||May waive a fee charge for pulling your reports.|
|Initial setup fee||May waive an initial set-up fee or sign up for higher tiers to benefit.|
|Tier of service||Ranging from quick fix to difficult-to-dispute negative items.|
|Guarantee||Company policy for money-backed guarantee (90-day guarantee etc.)|
|Credit bureau||Experian | Equifax | TransUnion | top 3 credit bureaus in U.S.|
If your credit report has many negative items, correct information or any complicated credit problems, consider hiring a professional company to help you. Credit help is necessary in this case. The company may contact all of the credit bureaus and your creditors for removal of negative items, not leaving a trace of items appearing on your reports again.
Note: 1 in 4 credit reports has a mistake. 5 percent of mistakes lower consumer credit score by 33 points. About 79% of small errors didn’t affect your creditworthiness.
List of credit repair service: Restoration & Monitoring.
A company has to provide a list of services provided for you to consider. Many credit repair companies displayed their services on their websites, being transparent to you. It’s important to ask any questions using the live receptionist chat or calling up the agency directly.
Learn how your credit score impacts you in Figure 3.0 below:
Figure 3.0 How does a bad credit score affects me?
|Negative Credit Reporting||Financial Education & Tools||Monitor my Credit | Identity Theft Protection|
|Original creditors & credit bureaus||Informational videos, guides, courses & blogs||Credit monitoring service & ID-Theft protection|
|More info..||More info..||More info..|
There’re pros & cons in using restoration as well as other types of services. Programs only induce customers (like you) to perform legal remedies but no guarantee or whatsoever in accordance to the Fcra law; creditors have the leeway to reject frivolous claims or disputes.
Note: Not all service providers accommodate full-fledged facilities for you to repair credit.
Can I “restore” my credit on my own?
If you’re afraid of falling into credit repair scams or had bad experiences with several companies, fixing your credit yourself is possible. There is a plethora of information on the websites of prominent agencies. Do use them (educational resources) for your reference.
Find out what’s the best debtor’s solution for you in Figure 4.0:
Figure 4.0 How can I fix my credit myself?
|Minor issues||Personally handle them or ask a company for a quick fix.|
|Complex issues||Hire credit repair attorneys or seek credit counseling services (DMP).|
|Difficult-to-dispute||Invest in aggressive credit repair companies & credit monitoring.|
After understanding what is credit repair and how it works, you’re ready to embark on a journey to recovering your bad credit scores. No, this guide is a basic preview of what is to come in the future. Find out more detailed credit repair reviews without compromising on the qualities of your needs.
Note: Generally, negative items “fall” off your credit reports after 7 years, bankruptcies & judgments about 10 years, and unpaid liens indefinite period of time.
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This article was originally published on January 02, 2014. It has since been updated.