How do credit repair companies work and why the heck can’t I just do it myself?
Have you ever seen an ad from a company claiming that they can’t boost your credit score?
Have you ever wondered “how do credit repair companies work?”
If you have any experience with credit cards, you’ve probably seen an advertisement for a credit repair company offering to help fix your credit score.
Maybe you have an excellent credit score and you don’t have to worry about credit repair!
Or maybe you’re among the 20% of Americans who can use some help building their credit score.
Whether you need to boost your credit score, or you just want to know more about the credit repair process, this article is for you.
In this article, we’ll talk about what credit repair is, how it’s done, and what method is right for you...
First, let’s determine together why you might want to fix your credit.
Should I fix my credit score?
Do your financial goals include using credit to finance your expenses?
In other words, do you see yourself using a loan in the future to buy a house or a car?
Or maybe you want to get a loan for that business you’ve been wanting to start.
In most cases, people with a low credit score may think that they’ll be able to fix their score by simply paying their bills on time.
But sometimes it can be more complicated than that depending on your credit history.
If you have a low credit score, then you’ll have to create a strategy that will increase it.
This is where the credit repair process comes in.
Usually boosting your credit is simple in principle but difficult to execute because it takes time and effort.
What is credit repair?
Credit repair is when a third party helps you improve your credit score. This process can include finding and disputing mistaken information with credit agencies. Experts claim that up to 70% of credit reports are reported incorrectly.
Third-party credit repair companies have resources that can detect what factors may be incorrect on your credit report.
Credit repair also includes adjusting fundamental financial issues that negatively impact your score. In other words, you’ll have to work towards paying off your monthly balance on a consistent basis if you aren’t already.
When it comes to repairing your credit, you can choose to do it on your own or use a third party.
There are pros and cons to both routes and we’ll help you make that decision for yourself.
How do credit repair companies work? And is it worth it?
Today, technology has helped the birth of dozens of companies out there who claim to be able to repair your credit.
While some credit repair companies can offer genuine value, others remain in question.
You may require professional help depending on the extent of your situation with your credit report.
The fact is, there is nothing that a credit repair company can do for you that you can’t do for yourself…
So even consider working with a third-party company?
You may want a third party for a consultation so you can speak to someone about creating a plan to boost your credit.
Or you maybe you’d want to use modern tools like Experian’s “Boost.” Which allows you to connect all of your utilities like your water bill, phone bill, and even Netflix to one bill!
For some, this may be something worth considering because of the convenience it offers.
If you have a low credit score, a credit repair company may be able to help you.
There are some sources out there that flat out say that all credit repair companies are scams. But the real truth is that there are companies that offer genuine value.
At the end of the day, it may help you to have extra guidance. And you can make that decision for yourself!
Remember, no one can magically remove information on your credit report that harms your score.
It doesn’t hurt to research into credit repair companies that suit your needs. Repairing your credit will bring you one step closer to finding a credit card that provides you with all the benefits that fit your lifestyle.
You’ll have to do more research into the reviews of a credit repair company to make an educated decision.
How can I help myself?
Inaccurate Information on your credit report
There is no quick fix to credit repair. Any company that promises you otherwise, is likely not telling you the truth.
If there is a problem on your credit report that you think is inaccurate, you don’t need a third party to help you dispute it. You can write a letter to your credit reporting company to dispute and let them know what information you think is inaccurate.
Accurate information that damages your credit report
If there is negative information on your credit report that is true, then only time and effort will mend the damage.
For example, bankruptcy can stay on your report for as long as 10 years. In which case you’ll have to strategize around building your credit. This may include using a cosigner for your loans, staying with one job (so lenders see stability), and of course, paying off your bills.
With some thorough research, you’ll be able to strategize a way to fix almost any problem with your credit.
If you’d like to learn more about how to boost your credit score, you can check out our article here on “How to Improve your Credit Score.”
There is no magic formula that’s gonna repair your credit report tomorrow. So if you see a company, that promises to boost your credit right away, then they’re likely not telling you the truth.
Decide for yourself how you want to repair your credit. In most cases, you’ll be able to fix your score on your own.
It will just take time and a conscious plan to get it done. You can even consult a non-profit credit counseling company if you need help with personal goals regarding your credit.
But you also have the internet and dozens of great resources out there to help you repair your credit score. And if you find one that you trust, then, that’s great news for you!
If you decide to make your own plan, you’ll have to do some research on your own.
And if you’re a personal finance nerd, then research is the fun part.
And lucky for you, Call to Leap loves to teach. So, if you’d like to learn more you can check out more of our articles. You can even start with our article “How Does Credit Card Interest Work?”