With the rise in debt among consumers, people may be tempted to use a credit recovery service to help them fix their credit. While there are many credit recovery companies out there that will honestly help their customers fix their credit, there are many that will make false promises or simply just scam the consumer. Here are a few tips on deciding whether to use help to improve a credit score.
Know the Rules
The Fair Credit Reporting Act secures each individuals right to fix any mistakes on their credit report for free. This means that each individual can run their credit report for free, identify the mistakes, and report those mistakes without any charge. So, why use a credit repair service?
Credit Repair Service
Many credit repair services will do all of this tedious paper work for the consumer. For example, it may take up to four hours of work to correct just one error on an individual credit report. Having a professional do all of this leg work can make an individual’s life much easier. Some credit repair agencies even offer to do some or all of these corrections for free, while others may charge a fee. Make sure to read the fine print to be sure. Just remember that the credit repair service will not be able to do anything that an individual cannot do for themselves.
Many credit repair services claim to be able to improve a credit report one hundred percent. Or, they may claim to be able to erase flags on a credit report such as bankruptcy. This is a sign that the particular repair service is not telling the truth. The truth is that nobody, including the repair service, can remove bankruptcy or other legitimate flags from a credit report. Bankruptcy will be on the credit report for ten years, and there is no changing that.
Another way certain credit repair services may take advantage of consumers is to offer a legitimate service, like correcting errors on a credit report. They collect a fee, but then never make the corrections. Just like when researching companies for any other service, consumers should be wary when researching credit repair companies.
Tips for Finding Help
Many people may find that using a credit repair service is the best plan for them. Here are a few tips for ensuring that a given credit repair company is for real. Contact the Better Business Bureau and the local attorney general’s office to make sure the company is listed and that there are no pending law suites against the company. Next, make sure to read and understand the Credit Repair Organizations Act in order to understand the rules that control credit repair service companies. Finally, make sure the company sends a contract that outlines payment, services to be provided, a time frame for services provided, any guarantees, and the company’s name and address.
Using a credit repair service can be an excellent way to save time and ensure that an individual’s credit report is error free. However, consumers should keep in mind that these repair services cannot legally do anything that an individual can’t do themselves. Consumers should also remember to be smart and do their homework when choosing a credit repair company to ensure that they are not scammed out of a fee.