Is It Worth Paying a Credit Repair Company to Fix Your Credit Score?

Credit repair companies help to fix your credit score in return for a fee. The companies can boost your credit score faster than you’d do yourself, saving you money in the long term.  By fixing your credit score, the credit repair companies help you to start enjoying a better score. The benefits can include access to credit and lower interest rates that help you save money in the future.  While there’re genuine credit repair companies, you should also be on the lookout for scams to avoid losing money or getting into other problems. 

What’s Credit Repair?

Your credit score is essential in determining whether or not you can access credit facilities or not. If your credit score is high, you’ll have an easy time accessing credits such as car loans and mortgages. The opposite is true.  As such, you should strive to maintain a high credit score. The credit score is determined by various factors, including timely payment of bills. Missing payments can also hurt your credit score.  The information on your credit report comes in handy in calculating your credit score. If the information in the report is inaccurate, it’ll harm your score. Identity thieves can use your name to take credit, or creditors give incorrect details to credit bureaus.  Credit repair tries to correct the incorrect information in your report. If the information in the report is accurate, a credit repair company may not do much to help. 

What Does a Credit Repair Company Do?

A legitimate credit repair company helps you boost your credit score, allowing you to start enjoying benefits such as lower interest rates. But how does the company do that? A credit repair company helps you remove any wrong information on your credit report that hurts your credit score. Illegitimate companies promise impossible results and also ask for money upfront.  The credit repair companies don’t do things that you cannot do yourself and for free. However, you can hire a credit company to take care of the process on your behalf to allow you to concentrate on other things. The company relieves you of the challenges of the overwhelming process. 

How Does Credit Repair Work?

If the details in your credit report are inaccurate, a credit repair company helps remove the information to boost your credit score.  However, there isn’t much a credit company can do that you can’t do yourself. But the company helps you if you are overwhelmed and require someone to take care of the issues.   

Steps for Credit Repair

  • The first step in credit repair involves taking your credit report and double-checking the details for accuracy. The law entitles you to one credit report annually from the major credit bureaus Experian, TransUnion, and Equifax. 
The credit reports from the various credit bureaus can differ as some creditors can report your details to one bureau and not the other. 
  • Check the information on the reports for any inaccuracies. For instance, if the reports contain late payments, check your payments records to see if the information is accurate.
Also, check for foreign accounts in the report. Such could be a sign of identity thieves using your account. 
  • If you discover incorrect information, you can follow the Federal Trade Commission (FTC) dispute process. 
For instance, you can write to the credit bureau outlining the details in your credit report that you dispute. If you have any documents to support the claim, you should attach them.  Alternatively, you can contact your creditors to dispute the details they provided to the credit bureaus.
  • The credit bureau will investigate your claim and provide a report within 30 days. They can also forward your letter and supporting documents to the creditor who provided the details you dispute. The creditor should investigate and provide a report to the bureau. 
  • After the credit bureau completes the investigations, they should get back to you in writing. If they rule in your favor, the creditor should notify the other credit bureaus to correct the information.
If they rule against you, you can still provide a written explanation to be added to your file.    You can learn more about debts, debt relief, and how to boost your credit score by clicking here