Do you have a bad credit score that is slowly but surely ruining your life? Not only does it make you practically ineligible for home, car, and business loans, but it creates hassles when you want to rent an apartment, get a new job, or even buy a new mobile phone connection. You may also face a difficult time in your relationship due to your financial mismanagement.
Rather than let things go on as they are, you will need to make an effort to change things and improve your credit score. While it won’t happen overnight, it is not an impossible goal. You can do it on your own, or you can hire credit repair companies to assist you. If you have a busy schedule or have trouble making sense of credit reports, the latter option may suit you better.
Let’s consider the pros and cons of hiring credit repair companies.
Pros of hiring a credit repair company
Credit repair companies have experience: They have the requisite knowledge of fixing credit scores and of the Fair Credit Reporting laws. They can inform you about your rights as a consumer. Additionally, they will know how to file legal documents, carry out the necessary correspondence with the three credit bureaus, and deal with bureau representatives and collection agents.
Credit repair companies save time: When you are trying to improve your credit score, you may have to engage in a lot of back and forth with the credit bureaus. Along with being time-consuming, these exchanges also entail knowing their correct procedures. That can be overwhelming for many people. It is much more convenient to let the credit repair companies handle the whole matter.
Cons of hiring a credit repair company
Credit repair companies can be expensive: While the disputing process with the bureaus is free, the services of the credit repair company aren’t. As per the Federal Trade Commission’s rules, you don’t have to pay them upfront, but only after they’ve done the work. Their price will vary according to the services they have rendered you, and, in some cases, it can be quite expensive. If you are on a tight budget, hiring a credit repair company might be problematic for you.
Credit repair companies can’t guarantee results: If you are expecting a credit repair company to perform a miraculous wiping out of your bad credit, you have the wrong end of the stick. What the company does is gather your credit reports from the three bureaus and go over these meticulously. They may take a couple of days to check everything thoroughly. If they find any errors in these reports, they will file disputes with the bureaus, provide them with documentation proofs that will uphold your side of things, and await their responses. They will then negotiate with the credit bureaus to have them change your credit score.
However, there isn’t much the credit report company can do if your bad credit isn’t due to overlooked errors, but on account of your failure to make timely payments or because you have defaulted on what you owe your creditors. In such a case, you are not going to get the results you want by hiring a credit repair company. It will be better to accept that you are at fault and get busy and pay off all your outstanding bills and other dues. It may take time, especially if you have a large amount of debt, but you need to be consistent about the repayments. Once you have paid off everything, your credit score will start to improve. You will have to take care that it doesn’t slide again.
Improving your credit score is a necessity to bring your finances back in order. The sooner you can get it done, the better it will be for you. You need to carefully consider if you have the time and the knowledge to handle it on your own, or if you will be better off hiring a reputable and experienced credit repair company. As we have seen above, working with a credit repair company has definite pros and cons. You will need to weigh in these to come to the right decision for yourself.
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