How Credit Repair Works

You’ve got some major life moves coming down the pike and you seriously need your credit cleaned up. But how do you go about it? Do you enlist the help of an agency, or do it yourself? You have decisions to make, but first you need to understand how credit repair works. Here’s that and more.

The Issue

It’s difficult to progress in life with bad credit or in some cases even middling credit. An unfavorable credit report can make it hard, if not impossible, to buy a house or new car or rent a vehicle. Sometimes, it can even stop you from gaining employment.

But scam companies do abound in the credit repair industry. These people are going around saying how they can make negative items on your report vanish, even if the items are accurate. This is hogwash, and you should run away fast. They’re after your money.

You should also give a wide berth to companies that want you to pay up front before a single service is rendered. Under the federal Credit Repair Organizations Act, that’s against the law.

What’s more, you should also give the bum’s rush to any company that counsels you to dispute everything in your credit report, or to do anything unlawful, like establish a new identity or attempt to “recreate” yourself with an Employer ID number rather than your social security digits. In addition, if a company doesn’t spell out your legal rights and what you can do for yourself for free, keep it moving.

So, to avoid getting in worse trouble than you are now, you must make certain you’re dealing with an established, reputable, credible agency.

What Are My Rights?

It’s essential to know your rights under the Credit Repair Organizations Act before you take on any kind of credit repair. If you feel your rights have been violated, check out Lexington Law reviews 2021 to see if that firm would be a good fit for assistance.

In any case, before you put your John Hancock on the bottom line, the company must provide you with a contract that explains your rights. For instance, a credit repair company is prohibited from billing you until they’ve done what they contractually said they were going to do, and from making false promises about what they can achieve. Also, did you know that even after you sign, you have a legal three-day grace period during which you can change your mind, at no cost to you? Well, you do.

What Should My Contract Specify?

Your agreement should contain clear details of services the company will perform, including the length of time it will take to see results. It also must specify any proffered guarantees and give the company’s name and physical address.

Your contract must also specify, in detail, what the charges will be and when they’re due.

What Can I Do for Myself?

If you’ve been turned down for credit, insurance, or employment within the past 60 days, you’re entitled to a free copy of your credit reports.

It also doesn’t cost a dime to check said reports for errors or outdated info that needs to be removed. You may be surprised by how much your scores can go up when such data is erased.

Now that you know how credit repair works, your rights, and what a scam company looks like. Take this newfound knowledge and get yourself back on solid financial ground. Ultimately, only time, a deliberate effort, and a manageable repayment plan will clean up your credit report.

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