There’s much ado made of credit repair companies. The purpose of this article is to share exactly who these services are for, how they work, along with the fundamentals of legal credit repair, and more.
Credit repair companies ain’t for everyone. They’re not for folks looking for instant, overnight, or immediate results, legal credit repair doesn’t work that way. Nor are these companies for the stereo-typical Johnny deadbeat who refuses to grow up and be an adult.
You see, credit repair companies are for good, honest, hardworking individuals that have experienced some of life’s lemons such as: job loss, divorcee, illness, etc. They’re also for people planning to purchase a home, finance a car, and stop paying the exorbitant cost of less than perfect credit.
Legitimate Credit Repair Companies
Legitimate credit repair companies will work with you, and using federal statutes, to remove any inaccurate, unsubstantiated, and unfair items on your credit reports. This is extremely useful when working to improve your credit score because your FICO score is a lot like your Grade Point Average (GPA).
The negative and derogatory items on your credit reports, is exactly like failing Algebra. It’s virtually impossible to earn a decent GPA with an F on your report card. This same exact principle applies to your credit score. It’s vital we clear credit report dings, and any negative information, so you can earn a FICO score you truly deserve.
There are a variety of consumer weapons at your disposal, and it will depend upon your exact circumstances as to which weapon will be most effective. In brief, the statutes that are most frequently used include the Fair Credit Reporting Act (FCRA), the Fair Debt Collection Practices Act (FDCPA), and the Fair Credit Billing Act (FCBA).
How Do Credit Repair Companies Work?
The very first step is to get all three of your credit reports with Experian, Equifax, and TransUnion. This is often done during your initial consultation, during which you’ll of course review your credit reports, and share what items you’d like to potentially have removed.
You’ll also need to share the details surrounding the items, because this will help with determining which weapons are most effective to get this item off of your credit reports. In other words, you can’t just say go fix my credit and remove all the negative information. You’ll need to provide a little more detail than that.
Depending upon your circumstances they’ll deploy a number of weapons on your behalf. We’ll start with the credit report dispute process, and your consumer rights under the FCRA.
This federal statute gives you the right to dispute and challenge any item on your credit reports, so long as you believe it’s inaccurate, questionable, or made in error. The credit repair company will often create a credit dispute letter and send it to the pertinent credit bureaus.
The FCRA requires the credit bureaus to investigate disputes once they deem them valid. This is where your value comes with a credit repair company. In short it’s virtually guaranteed the credit bureaus will find your dispute invalid or frivolous, in which case they’re not required to investigate.
This is for many reasons, we don’t have the time to share here, so make sure to sign up for our free newsletter and join our congregation for more credit help. The credit bureaus typically request additional information. This is a sophisticated, well thought out, and designed system to frustrate you and all consumers.
One of the many reasons is because the credit bureaus only spend money investigating and correcting any consumer’s credit report. There is no profit for the credit bureaus to earn. And it’s no secret the credit bureaus have very inaccurate credit reports about you and me.
In 2013 the Federal Trade Commission (FTC) reported the findings of their study which found one in five American’s credit reports contains an error. This is millions of American’s with inaccurate information on their credit reports.
As one of many seemingly endless examples of the credit bureaus stall tactic laden system also occurred in 2013 when a woman, Julie Miller, sued Equifax and was awarded $18.6 million. The short version is Julie had a random woman’s bad credit showing up on her credit reports, an obvious mistake.
Julie tried to exercise her rights and filed a credit bureau dispute with Equifax, who found it frivolous and requested additional information. Over the next two years, Julie sent in W-2’s, pay stubs, hair samples, DNA, and any other identifying information, all to no avail.
This was a glaring mistake. Julie went from spectacular credit to a very poor credit score. And this is just one of countless examples of the credit bureaus and their unfriendly consumer ways. Not to mention the many times the credit bureau have been collectively fined by the FTC for violating consumer rights.
Hopefully your issues aren’t this extreme, and this is the big benefit of hiring a professional is that you don’t have to deal with these less than helpful credit bureaus. However you will personally be notified of the credit bureau investigation results.
In other words if an item was removed from your credit reports, or if the credit bureaus verified the item, or if they need additional information. You’ll need to share this with your credit repair company, so everyone can stay in the loop with your case progress.
On a sidebar, an amendment in recent years to the FCRA now enables you to dispute creditors, lenders, and data furnishers directly. Thus by passing the credit bureaus, and this can be quite useful.
In addition, if you have collections on credit report files or are currently dealing with debt collectors you may need to exercise your rights under the FDCPA. The big coup of this federal statute is the ability to request debt validation on your account.
This is how to tell the collection agency to first prove this is your debt, and it’s legit, and legal before talking about even the possibility of payment. There are strict guidelines and parameters collection agencies must follow, and rarely do. Exactly like the credit bureaus and the FCRA.
Again depending upon your circumstances, you may need to also settle or properly go about paying off collections, so can get negative information off your credit reports. The painful truth is no legitimate credit repair company can guarantee any specific outcomes.
The law is on your side, and you have many weapons to work with, however if an item is truly accurate, fair, substantiated or verified during an investigation then as you’ve surely heard you’ll have to live with it for a maximum of seven years or ten years with a chapter seven bankruptcy.
That’s the maximum. There is no minimum amount of time any item must remain on your credit reports. And the test of an item being accurate, is when the credit bureaus investigate!
How Long Does It Take To Repair Credit?
Naturally this depends on your circumstances. The more damage to your credit, the longer you’ll need help. Typically you can expect roughly six to twelve months.
We can guarantee it won’t happen overnight, tomorrow, or next week. It’s a bit like a substance abuse issue, the stronger the substance and the longer the use, the more treatment needed.
You can anticipate being able to have a client portal or a website where you can visit to see the latest progress with your case. And many folks see a significant improvement after about three months, again this is not guaranteed.
Credit Repair Organizations Act (CROA)
Their is federal law that also protects you from unethical credit repair companies. In short you need to be cautious of anyone telling you anything too good to be true. Further its a red flag if a company guarantees a specific outcome. For example if they guarantee they can remove an item.
Instead, look for offers of a refund. Additionally, be cautious of anyone talking about changing your identity, or social security number of any tactic of this ilk. Because that’s not legal or legitimate credit repair.
How Much Does Credit Repair Cost?
Legal, legitimate, and reputable credit repair companies are very affordable. Generally you can anticipate a one time, upfront, or first work fee in the ballpark of $100 to $200. You may also have to pay a one time cost of about $20 to get all updated, current copies of your three credit reports.
Then you’ll be responsible for a monthly payment of about $100. However one of the best services is the Credit Pros because they don’t require a monthly payment and instead you’re only responsible for payment when they remove items from your credit reports. In other words, it’s a pay for results plan.
Do It Yourself
Listen, you don’t have to hire a credit repair company. And if you only have a ding or two on your credit reports, you may want to proceed on your own and try doing it yourself. However if you have a few dings, value your time, or want professional, expert, and experienced credit score help then we’d encourage you to hire a quality firm.
Keep in mind, you also don’t have to hire a mechanic to service your car, someone to cut your hair, or even buy toilet-paper! Hallelujah most of us can agree on the value of TP.
The Best Credit Repair Companies
There’s many effective credit repair services, however we encourage our members to check out the Credit Pros. This is one of the best credit repair companies because they offer a pay for results plan.
You’re responsible for a one time, first payment of $179 and then only after they remove negative items from your credit reports will you pay another nickel. You will be responsible for $50 per item, per bureau and $75 for public records.
You’ll only be responsible after the item has been successfully removed from your credit reports. Moreover, if for some unforeseen reason the Credit Pros are unable to successfully remove items from your credit reports in the first 90 days, then you’re guaranteed a refund on every single dollar.
They’ve helped clients remove all sorts of negative credit report items including: late payments, collections, charge offs, judgements, repossessions, tax liens, foreclosures, even bankruptcies, and more. For more details check out our Credit Pros reviews.
Take action today and get a free credit consultation with a certified FICO professional by calling toll-free 1-877-418-7596. And for more strategies to repairing credit with Dan Willis sign up for our free newsletter, and join our congregation.
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