Personal Credit Repair, is it Worth it?
With all the headaches that come associated with having a low credit score, sometimes it seems like all is lost and through desperation, you may have considered hiring a credit repair company. But with such a negative stigma associated with the industry, you may have asked “Should I even hire a credit repair company?”, or “Is this legit? Will I get scammed?” Today, there are unfortunately a lot of bad apples in the industry that have led to many not even giving the chance to honest and good credit repair companies. Let’s dive in about the subject of personal credit repair and whether it makes sense for you to try.
Personal Credit Repair
There are thousands of credit repair companies out there and hundreds of methods credit repair companies use. But most credit repair companies operate the same way, disputing negative items on your credit report to either get removed or corrected to show a positive report. Nearly 70% of all consumer credit reports have inaccuracies, which is good news because, under the FCRA (Fair Credit Reporting Act), all items on a consumer credit report must be 100% accurate and verifiable to be on the report. This has paved the way for many credit repair companies to spring out with the goal of assisting people to clean their credit reports and assist them in accomplishing goals.
It sounds relatively simple, but it is a bit more complicated than that. The route that the majority of credit repair companies take today is disputing negative items, providing results, and allowing their clients to go back into the world and most likely make the same mistakes before. Credit is the least talked about subject, yet it has the largest impact on every single American citizen’s life. There are very few companies that practice not only an effective dispute process but also an extremely effective education process. The difference between getting your credit repaired and getting your credit repaired and knowing how to maintain and continue building it is the reason why you will either end up in a loop and bouncing between credit repair companies or deal with 1 company and move forward in a timely manner.
At Credit Supreme, we are the pioneers of getting our client’s the strongest results in the quickest time frame, as well as educating each and every one of our clients every step of the way. Other companies tend to select with items they choose to dispute, usually ones they see they can get off relatively easily. The purpose of disputing only a handful of negative items by other credit repair companies is to provide a casino effect. Provide minimal results over a long period of time to keep you in the program for longer, and address the items you desperately need to be addressed on their accord.
My Credit Score is Low, Should I get my Credit Repaired?
Before we answer that question, you will need to diagnose why your credit score is low. Accessing a copy of your credit report will help answer that question for you. If you are dealing with late payments, excessive hard inquiries, or derogatory marks, you may want to explore the option of getting your credit repaired. Your credit score may be low due to other factors that do not require a credit repair company to step in and help. Your credit card utilization makes up the largest portion of your credit score. Upon checking your report, if you notice your cards are over 30% of your credit card limit, your score is suffering due to it. Paying your balances down will assist in bringing your scores back up to where it once was.
Another reason why you may not need credit repair due to a low score is a lack of credit history. For those who have yet to obtain significant lines of credit under their name, or accounts aging over a year, your credit scores will naturally be low. A way to begin bolstering your credit report is by obtaining a secured credit card and begin making on-time payments with that card. Do not close any line of credit preemptively and make sure you make as many on-time payments as possible. After some time, your score will begin to increase and you will begin being able to obtain additional lines of credit which in turn, will begin improving your credit scores and your overall credit report.
Can I Repair my Credit Myself?
Of course! Any individual is more than able to dispute negative items being reflected on their credit report. The only issue people run into is the time required to dedicate to repairing their own credit. There are some factors needed to be taken into account before beginning to dispute negative items on your credit report.
1 What Negative Items are you going to Dispute?
Having a copy of your credit report handy will be vital in your dispute process. Ideally, having a credit monitoring service, such as Smart Credit, that will provide you with a refreshed report every 30 days will allow you to become consistent in sending disputes and see updates on your credit report. Once you have your credit report, begin documenting your negative accounts and exploring the options of the types of dispute letters you will send to get the item removed or corrected.
2 What Disputes should I Send?
The dispute letters you need to send are based solely on the account itself. It will require some research on which disputes you use for which accounts and which marks and the frequency you need to send them. Each account is different and some letters provide stronger results, it all goes back to your strategy on how you are going to resolve that account and your failsafe if the accounts aren’t resolved.
3 What Should I Do if I get a Response?
Since you will be disputing these accounts through the major bureaus, you will need to know and understand the response formats they can provide. You will need to dissect every single letter and email you receive from both the bureaus and the creditors and respond in a timely enough manner. A quick and correct response will be the reason why or why not that account will be deleted from your credit report.
4 How Long Will it Take?
Just like building your credit, repairing your credit takes a long time as well. There is no overnight fix unfortunately and can take months or even years to get accounts removed from your report. On average, individuals attempting to repair their credit file take anywhere between 12-24 months, while most credit repair companies can repair consumer credit reports in 8-12 months, Credit Supreme currently has a 4-6 month turnaround time.
5 What if the Negative Items don’t get removed?
It is common to not get results for a period of time, however, if your dispute results come back as verified and accurate in every dispute, then it looks like that account may no longer be eligible to be removed. If that is the case, definitely reach out to a credit repair company and discuss the possibility of being able to get that account removed.
What to Look For in a Credit Repair Company
With so many companies available and even more claims of their successes, it is important to note what kind of help is needed and what will benefit you the most. There are companies who provide you with the dispute letters and you dispute yourself, which is a good option but definitely the most tedious and time-consuming. There are companies out there who dispute on your behalf, which is great and definitely alleviates a lot of the stress of having to lick envelopes and visit post offices frequently.
When deciding which company to choose from, you must take into consideration these main points:
- How many dispute letters will be sent out on your behalf every month?
- How long can the process take, and what is the average turnaround time for past clients?
- What are the guarantees this company is providing?
- Will they be a point of contact for guidance and questions if need?
- What do current clients and previous clients have to say about their practice?
There is something extremely important to note when doing research to find the credit repair company for you. CREDIT REPAIR IS NOT GUARANTEED. Companies claiming they guarantee results, or a significant score increase is 100% lying and is just trying to take your money. It is important to understand that results are not in the hands of either you or the credit repair company you are looking to hire. Results are strictly based on the bureaus and the creditors, so do not fall for the 30-day fix, credit sweeps, or guarantees of 100 points in 60 days.
An important factor as well as the education aspect. If you are unable to have a point of contact to guide you and not let you repeat the cycle of making simple mistakes with your credit, you will most likely inadvertently make the same mistakes that lead you to this point. It is ok to not know everything and anything about credit, but having a resource who does will be the reason why your scores get better, and maintaining them will be easier.
It is really important to understand what exactly the issues on your credit report are before seeking out additional help. Simple fixes on your report can save you money and time and understanding when your credit report is too far gone before you hire a company. There are thousands, if not tens of thousands of companies to choose from, make sure you research every company on your radar before making a decision. Companies like ourselves prioritize our clients and their goals first and foremost, and we strive to make sure to educate you along the way. If you are in a financial bind and wish to attempt to repair your own credit, we always encourage you to do so. Just make sure you do your research and more importantly stay consistent in order to get you the results you need.