Everything becomes harder when you have bad credit. Thankfully, there are hundreds of credit repair services around the country.
These businesses aim to help consumers improve their credit score, an enticing pitch to any consumer with a poor credit.
So what are these credit repair businesses and how do they really work?
How do credit repair services work?
A credit repair service offers to “fix” a consumers credit for a specified fee. Most credit repair companies will offer these services:
- Find and dispute items on your credit report(s) that are false, inaccurate, or wrong
- Communicate with the three major credit bureaus to ensure your records are up to date
- Monitor your credit score and report for any changes
Just like any other profession, there are good credit repair services and bad credit repair services. Before you choose, be sure to conduct research beforehand to see what other consumers have had to say about a specific credit repair service. You can use review sites like Yelp or Google Reviews.
Repairing your credit yourself
Although a credit repair service can help raise your score without you having to raise a finger, there is one major downside.
You can perform all of the services the credit repair company does on your own. While these services can save consumers time, you should see whether the financial investment is worth the potential return.
Your credit repair rights
Due to an increase in scams, multiple laws have been past to protect consumers from fraudulent credit repair companies.
A credit repair company that is legitimate will:
- Not state any false or misleading information – A credit repair company cannot tell you that they will remove a negative entry from your credit report if it’s true and accurate. If the negative entry on your credit report is true and accurate, they cannot fix it for you
- Never ask for advanced fees – A credit repair company is not legally allowed to accept upfront payment or upfront fees, no matter the case. You should only pay once the contract has been fulfilled.
- Provide a written contract – This contract should allow you the right to cancel the services without any penalty or obligation within three business days after the signing of the agreement
A credit repair scam that is not legitimate or legal will:
- Ask for an advanced payment before a single service is provided to you. This is illegal and should serve as a large red flag.
- Not provide a contract. A legitimate credit repair company will always provide a contract.
- Tell you to dispute each and every single item on your credit report. Credit bureaus are not required to follow up with inaccurate disputes.
- Advise you to open new credit card accounts using false information.
Consumers with bad credit serve as prime targets for credit repair companies. If a credit repair company does any of the illegal actions above, leave immediately and take every document you brought with you and any document you may have signed. This can help serve as evidence later on.
It is nearly impossible for consumers to find a line of credit at an affordable interest rate with bad credit. If you have less than perfect credit and don’t know where to go, CrediReady can help.
Our trusted network of credit repair experts can boost your score and help you qualify for the credit you need. Take a moment to fill out our free no-obligation credit repair inquiry form and start fixing your credit today!