Credit Reporting

Are Credit Repair Companies Worth It?

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Are Credit Repair Companies Worth It?

Sometimes it may seem like your credit score is doomed, but a credit repair company may be able to turn it around.

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Many people who are suffering from bad credit scores are willing to go to any lengths to make sure their credit gets fixed. This includes hiring a credit repair company. For a fee, these companies promise to help remove any negative information that may be affecting your credit score.

How Do Credit Repair Companies Help?

Once hired, a credit repair company will take a closer look at your credit report and check it for any inaccuracies. If they find any mistakes, they will give their best efforts to fix them. Unfortunately however, sometimes this process can be lengthy and can cost you a pretty penny.

Credit repair companies require a monthly fee to be paid for their services. If their efforts are taking longer than a few months, you may soon find yourself breaking the bank just for them to get the job done.

What Credit Repair Companies Can’t Do

Before you get ahead of yourself, it’s important to note that while credit repair companies can remove false negative information from your credit report, they can’t do anything about information that is correct. Any companies that claim they can are likely not legitimate.

The only thing you can do to fix your bad credit is by changing your habits and paying off your bills on time. A credit repair company can’t do this for you.

Choose A Credit Repair Company With A Good Reputation

If you’ve decided on going with a credit repair company, be sure to compare a few before committing to one. Some companies may offer more affordable rates, while others may have a better history of helping their clients.

You should also have high expectations for the company you’ve hired. They aren’t just there to fix your credit report. They are also there to provide you with advice on how to manage your credit going forward and to make sure you never have to rely on them ever again.

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How Do I Know If I Need A Credit Repair Company?

Not everybody needs a credit repair company. In fact, you can go about repairing your credit on your own. Simply request a copy of your credit report so you can try to scour for the errors on your own. If the errors are due to something like identity theft however, you may need outside help and it would be wise to get a professional opinion instead of trying to fix things on your own.

Alternatives To Using A Credit Repair Company

As we mentioned before if your credit report’s negative information is correct, there’s not much a credit repair company can do. In this case, your only option is to take matters in your own hands. Here’s what you can do:

  • Pay off any debts that have gone to collection agencies
  • Refrain from applying for any more credit or loans
  • Do absolutely nothing— if it’s been long enough, some debt will vanish on its own.