How to Get Help with Credit Repair Services

Many people have a problem controlling their credit card spending habits. As such, many people have a lot of credit card debt and thus, have financial problems because of it. Because of this constantly increasing debt, many people are late making payments, have charge-offs, and/or fail to pay a bill altogether. These practices lead to the destruction of a person's credit report and ultimately negatively affect a person's credit score. Most negative credit report information takes anywhere between seven (7) to ten (10) years to be removed from your credit report. However, a credit repair service can help you overcome these problems and put you on the fast track to credit report recovery.

Speaking from personal experience, credit repair companies can help you restore your credit report. When I was in college, I made the mistake of obtaining credit cards regardless of the terms attached to the same. As such, I ended up with numerous credits with ridiculous annual fees and very high interest rates. Additionally, because I lacked the knowledge on how to correctly use credit cards, I used my credit cards like a second bank account. Needless to say, my debts caught up with me, and I was soon in financial trouble.

The good news was that I was young enough to learn a lesson from my experience. However, the bad news was that my credit report was left in shambles. I did not want to wait the seven (7) to ten (10) years it normally takes for negative information to be removed. As such, I asked around and received a referral from a friend for a credit repair company.

Credit repair companies dispute the negative information in your credit report by using the law of the Fair Credit Reporting Act. Basically, if negative information in your credit report cannot be "verified" it must, by law, be removed from your credit file. Credit repair agencies use this federal law to basically exploit the fact that credit card companies usually do not keep exact records. As such, many times the negative information in your credit report cannot be verified and thus, it must be removed.

Credit repair companies can help, but you have to be aware of certain things. First, there will be a fee for their services. However, you should not pay too much money (no more than a couple of hundred dollars, depending on how much negative information is in your credit report). Also, you have to be patient. Depending on how much negative information is in your credit report, the entire process could take a year or more. This is so because by law, the credit reporting bureaus (TransUnion, Equifax, and Experian) have up to thirty (30) days to respond to your dispute. Additionally, you may have to dispute some information more than once. As such, the timeline gets longer.

If you have negative information in your credit report, credit repair services is an option that you should consider. However, do not pay too much, be patient, and keep your credit repair company aware of any correspondences you get from any credit card company or any of the credit reporting bureaus.

Beware of Credit Repair Services

It is true that many companies exist that will claim to clean up your credit report for a fee. Some of these companies are less than ethical and some are outright scams. However, there are many legitimate companies that will clean up your credit report for a small fee. Many people believe that all of these credit repair companies are cheats that take your money and do no work to help you out. This is simply untrue. However, if you do not know what you are doing or do not keep tabs on the credit repair company that you may hire, you may be take advantage of, your credit report may not be fixed, or both could occur.

If you have late payments, collection accounts, bankruptcies, or any or all of these things in your credit report, you know that these things lower your credit score (some more than others). If you have these things in your credit report, you may have to hire the services of a professional "credit cleaner" in order to maximize the use of your credit report. For the most part, these companies dispute inaccurate information on your credit report in attempts to remove some of the late payments, collection data, and other negative information that have been compiled in your report. The thing that you have to be most concerned about is that these companies not only behave ethically, but that they also behave legally. Creating a new social security number or a new identity in order to avoid your debt obligations is fraud. Therefore, do not engage in such activity.

Many skeptics argue that everything that these credit repair companies do can be done yourself for less money. This is 100% true, but I do not see how that is relevant. I can make dinner at home for less money than going to a restaurant. However, under the skeptics' logic, I should not go to the restaurant because it will cost more than making dinner at home. The point is, if you use a credit repair company, you are paying for experience and convenience.

Keep in mind that you do not have to use a credit repair company is you do not want. As stated in the above paragraph, you can clean your credit report yourself. However, if you decide that your credit report needs to be repaired, you should analyze your situation and decide which option (paying a company to do it or doing it yourself) is best for you. Either way, if done correctly, the results will be worth the time and money.

How Long Can a Bad Credit Report Haunt You?

A good credit report is an important financial asset to possess. A good credit report can help you obtain loans (including the big loans such as a mortgage, a car loan, and/or a college loan, to name a few), help you obtain a low interest rate on those loans, and will help you obtain favorable loan terms. Therefore, a good credit report will help you obtain loans and will help you save money by way of lower interest payments.

There are many things that you can do to your credit report that will negatively affect it. Some things are small (such as having a low credit to debt ratio, having too many credit report inquiries, and closing a credit card account, to name a few), but there are many "big" things that you can do that will severely lower your credit score.

A bankruptcy is probably the worst, one trick pony that can happen to your credit report. Before you decide to file for bankruptcy, you need to think long and hard about the benefits and penalties. The most obvious benefit is that most of your debts will be discharged (with the exception of certain debts like mortgages, student loans, and IRS liens), however, a bankruptcy also means that your credit report and your credit score will be severely damaged. By severally damages, I mean that your credit score will decrease by several hundred points.

Things such as late payments, charge offs, and collection accounts can also dramatically reduce your credit score. These things will not reduce your credit score to the same extent as a bankruptcy, but they will still do some pretty heavy damage. Therefore, you should consistently pay your monthly payments on time so these things do not happen to you and thus, will not be reported in your credit report.

Even though these things will dramatically reduce your credit score, many people may think that this is not a big deal because the information will be removed from their credit report eventually. What these people do not know is that late payments, charge offs, and collection accounts can stay on a credit report for up to seven years. Therefore, should you do things to improve your credit score during this time, those improvements will be offset by the negative information that remains. Even worse than the seven year time frame for the above listed credit report problems is a bankruptcy. A bankruptcy can stay on your credit report for up to ten years.

The point is, these problems do not go away overnight and thus, should you engage in this kind of behavior, you will pay for it for many years.

Companies that Improve your Credit Report for a Fee

It is true that many companies exist that will claim to clean up your credit report for a fee. Some of these companies are less than ethical and some are outright scams, however, there are many legitimate companies that will clean up your credit report for a small fee. Many people believe that all of these credit repair companies are cheats that take your money and do no work to help you out. This is simply untrue. The company that I used to clean up my credit report definitely did its job, and has helped me raise my credit score over 100 points over the course of one year.

Many skeptics argue that everything that these companies do can be done yourself for less money. This is 100% true, however, I do not see how that is relevant. I can make dinner at home for less money than going to a restaurant. However, under the skeptics logic, I should not go to the restaurant because it will cost more than making dinner at home. The point is, if you use a credit repair company, you are paying for experience and convenience. Of course you can do everything yourself, however, if you pay a company to take care of the problem, this means less work for you and, if the company is reputable and experienced, faster results.

Does this mean that you should use a credit repair company no matter what? No, you should not use one of these companies no matter what. If you decide that your credit report needs to be repaired, you should analyze your situation and decide which option (paying a company to do it or doing it yourself) is best for you. Either way, if done correctly, the results will be worth the time and money.


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