Is Credit Repair Worth Your Time?

If you’ve been denied credit for any reason, chances are you’ve wondered about credit repair companies that promise to repair your credit in a matter of months. Even the quickest of glances at information on the Internet will have your head spinning. Some sources say never use a credit repair company because you can do what they can do for free. Other sources suggest that some repair companies are reputable while others are not, and you just have to be careful. Some go so far as to promise you a perfect credit score within a month. It can be more than a little overwhelming. So, if you need to improve your credit score, what should you do? Is credit repair worth it?

The short answer is, yes. There are consumer credit companies that can help to repair your credit rating. The slightly longer answer, however, is that it is not magical, it will not happen overnight, and you will need to do some work to make sure that you are dealing with a reputable company.

First of all, make sure that the company you are working with is licensed and authorized to do the work they are promising. In today’s virtual-electronic world, it is easy for anyone to create an Internet site and claim to do a certain kind of work. Check to make sure that the credit repair company you will be working with is licensed and bonded.

Also, federal law prohibits a credit repair company from collecting money without performing a service first. Therefore, do not do any business with a company that tries to collect money from you before they have achieved any results for you. No payment should be required until a service has been performed.

By the same token, a company can offer you a refund policy, but be wary of a company that makes guarantees beforehand about specific results. If a company is promising off the bat that they will raise your credit score 50 points in the first month, you should be asking how they can know that since they are not the ones who control the credit score.

Finally, if a company says that they can create a new identity for you, they are operating illegally. Some companies will not offer a new identity, but will offer “file segregation.” This is the same thing. Getting involved with file segregation is not just a bad idea, it is against the law because it will require you to commit fraud every time that you apply for credit. No amount of credit is worth going to jail.

Bad credit can make life difficult, and it is only natural to want to correct it as quickly as possible. However, when doing so, make sure to deal with a reputable company that truly has your best interests in mind. Take the time to make sure that the company can truly repair your credit score rather than making it worse.


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