Credit Repair Services Can Help Improve Credit Score

A credit score is the most important number when it comes to obtaining loans, credit, mortgages, insurance, and in some instances, a job. Your credit history is the one and only thing that impacts your credit score. Bad credit generally means higher interest rates from lending institutions, disapproval on loans, higher insurance rates, etc. However, your credit can be improved through various measures provided by credit repair services.

What is a Credit Repair Service?

A credit repair service is a company that assists consumers in removing incorrect information from their credit reports in an effort to improve their FICO score. Credit repair agencies differ in the depth of services they offer, however, all are governed under the federal Credit Repair Organizations Act designed to protect consumers. Some credit repair services offer strictly credit report review and dispute services, while other credit repair companies provide debt settlement and programs that help reestablish new, positive credit avenues.

What Credit Repair Services Can Do

Credit repair services specialize in conducting the tedious legwork involved in cleaning up your credit. A credit repair agency reviews the credit reports from all three credit bureaus for any incomplete information or errors. This is particularly beneficial if you suspect you are a victim of identity theft. Credit repair services investigate any inaccuracies, gather required documentation and file the necessary disputes on your behalf. Examples of common inaccuracies found on credit reports that negatively impact your credit score are late payments, collections, tax liens and charge-offs. Credit repair services are a valuable time-saving resource, especially if there are numerous inaccuracies in your credit report or you have a long list of creditors.

What Credit Repair Services Cannot Do

As the Federal Trade Commission points out, credit repair services cannot remove negative information from your credit report that is correct, erase your bad credit, remove legitimate liens, judgments, bankruptcies and bad loans from your credit report, or legally create a new credit identity for you. Consumers should beware of credit repair companies making such promises or guarantees.

Credit Repair Services Versus Do It Yourself Credit Repair

Credit repair services have the expertise in working with credit bureaus, know the ins and outs of credit law, and have the inside track on securing various settlements or repayment plans from their daily dealings with various creditors and lending institutions. However, you can clean up your own credit and achieve the same results, free of charge. For instance, you can contact all three credit reporting bureaus and dispute any incorrect information in your credit report, or contact each of your creditors directly and work out a settlement or payment plan to rebuild your credit. However, do it yourself credit repair takes time and effort, good organizational and record-keeping skills, and a deep commitment to adhering to a debt repayment plan.