Credit Repair

What Credit Repair Companies Do and Why You Should Hire One

What is Credit Repair? It is an act of clearing your bad credit history. People need to maintain a good credit score for future applications of car loans, home loans, and other credit purchases. Otherwise, you will have a hard time getting your loans approved in the future. 

Maintaining a good credit score seems easy. You only avoid paying bills late. But let’s face it, most of the time we forget to pay before the due date and sometimes we even don’t pay the bills at all. Because of these mistakes, we end up having a bad credit score. Though you can try and fix your credit score on your own, there are credit repair agencies out there who can help you fix your credit score. 

What Do Credit Repair Agencies Do?

The general idea is that they will help you repair your credit score. How do they do it? The first thing they will do is look at your credit report. By looking at your credit report, they will see which factors have hurt your score. They will pull up your credit report from the three credit bureaus. These are Equifax, TransUnion, and Experian. Know that you are entitled to receive a free credit report each year from each of these bureaus. 

Your agency will then take a look at the bad items on your credit report. Many things hurt your credit score. These are late payments, not paying at all, charged-off account, debt collection account, Maxed out credit card limit, court judgment, and others. When they identify the contributors to your bad credit score, they will collect all the documentation you have that will help them dispute the errors in your credit history. They will work with the three credit bureaus and decide whether to remove the bad items from your credit report.

A good credit repair agency makes sure they work with all three bureaus to avoid confusion. This is because of non-consistency on your credit report. It is not guaranteed that all three bureaus contain the same information. The banks, mortgage lenders, and credit card issuers might not have sent reports of your credit to all three bureaus.

Know that you can do your credit repair on your own for free. But if you think your credit score is too low, then you might want professionals to get involved to ensure more success with your disputes. One of the benefits of hiring a credit repair company is that these agencies have lawyers, these lawyers have a deeper understanding of the trade industry and the laws associated with it.

Why should you hire an agency? Why not just do it yourself? – Credit repair companies are not only there to help you clean your credit record. They are also consultants who can help you better understand how credit works. They can help you evaluate your credit report and formulate strategies you can apply to keep a good credit score.

To set a correct expectation when hiring a credit repair agency, it is not guaranteed to improve your credit score. It depends on how much documentation you have to back up your dispute. To answer the question of whether these agencies can help improve your credit score, the answer is yes.