Credit Repair Company Definition
A credit repair company is defined as an organization that provides you assistance to bolster your credit score through various means such as checking your credit report for accuracy with the credit reporting agencies, settling any credit report dispute as it arises, handling credit repair in the wake of bad debts and the like. To put it another way, this is an organization that help you in improving your credit and financial management.
What can a credit repair company can do for you?
A good number of people advocate a “go it alone” credit repair method instead of availing the services of a trustworthy credit repair company. Is this really the best route to take? It’s your choice. Here is what the credit repair agency should offer you:
- making sure your credit report is accurate as per each major credit Bureau (there are three of them – Experian, TransUnion and Equifax)
- initiated a credit report dispute when inaccuracies are discovered; and following up until those mistakes have been corrected
- advising you on the proper action to take so you can improve your credit score within the shortest possible time
- counseling you on proper management of finances so you will avoid future debt problems
- facilitating avenues that will enable you to earn your living again
- keep a close eye on the credit report to detect any errors that could lower your credit score
- advising you on maintaining a favorable credit-to-income ratio for best results on your credit score
What a credit repair agency can not do.
A lot of people perceive a credit repair company like they would a genie in a magic lamp. But credit repair agencies cannot perform miracles. Here are some things that a credit repair agency can not do:
- settle any credit report dispute overnight – it takes at minimum 60 days
- repair credit reports overnight – it requires at least 6 months
- wipe off bad debts – it takes a minimum of 6 months
- change facts entered in your credit report – it will delete those which are genuinely inaccurate
- wipe off the history of bankruptcy – it can only help you bolster your credit score as a bankruptcy record will stay on your record for a minimum 7 years
- improve your credit score in an instant – this is a gradual process that will take at least 3-6 months
3 red flags that point to a scam credit repair company
There are lots of unscrupulous companies out there who take advantage of the gullibility and helplessness of indebted people to make a fast buck. These are three warning signs that should tell you that the credit repair company is fraudulent:
- it asks for their fees in full upfront
- too-good-to-be-true promises of fast results
- use of “shady” methods to accomplish credit restoration
Avoid such a company like the plague! Remember, a bad debt or even bankruptcy can eventually be resolved. But breaking the law to fix poor credit can backfire in a terrible way. Never be tempted into accepting such “help” because these organizations are not trustworthy and will cause you untold grief.