When you have a low credit score it may be difficult to get attractive interest rates, meaning it may be time to consider making some changes. One of the changes many consider is credit repair services. But how do you determine if a credit repair service is right for you? Learn all about credit repair services below.
What Is a Credit Repair Service?
Credit repair services help to remove inaccurate or incorrect information from your credit report, which can bring your credit score down, by filing disputes with credit reporting agencies on your behalf. Companies that offer these services also provide advice on how you can improve your credit score.
What they cannot do, is remove accurately reported information, even if it harms your credit score.
The types of inaccuracies credit repair services can address include the following:
- Accounts that are not yours.
- Bankruptcies and other legal actions that do not belong to you.
- Misspellings that could equate to inaccurate negative reporting or positive entries that aren’t displayed.
- Old negative marks that need to be removed from your credit report.
- Debts that cannot be verified or validated.
It’s important to note that you can clear up these issues on your own, however, it is a time-consuming process. Credit repair services charge a monthly fee for the convenience of having someone else act on your behalf, which can take months or even years to clear up.
What Is a Credit Report Dispute?
When you find inaccurate information on your credit report, you must dispute it to have it removed. The process does take time, energy, and some degree of persistence. That is one reason why it can take so long for credit reports to improve — even when using credit repair services.
When you file a dispute with one or all of the major credit reporting agencies:
They will notify the reporting creditor of the dispute and allow them 45 days to prove their claims. Once the 45 days pass, it will be up to the credit reporting agency to remove the negative report or leave it in place.
If they deny your dispute, there is a process by which you can escalate your claims. You will generally need to offer proof of your own for this to occur, such as a canceled check reporting that you have paid your bill.
Are They Worth It?
In some cases, they are well worth the money. That is especially true if you have inaccurate, false, or outdated information on your credit report keeping your credit score artificially low.
Additionally, some people view time as precious of a commodity as money. If you are among that group, you will likely feel that credit repair services are well worth the investment.
However, credit repair services are not the right fit everyone. These services can only help with the removal of false information from your credit report and cannot erase past mistakes. In most cases, waiting seven years will allow all the negative information on your credit report to disappear.
Credit Repair Service Company Caveats
Be wary of some fraudsters disguised as credit report repair companies. Look to avoid companies that hold lofty promises and demand upfront payments. It is also a big red flag if a credit repair service company says they can remove all negative information from your credit report. That is not true, as no one can remove accurate information from your credit report.
- Credit repair services can save you time when it comes to removing false information from your credit report.
- You can do the things credit repair services without paying fees.
- A higher credit score means you qualify for lower interest rates and more loans.