If you’re here reading about building positive credit, chances are you have some negative credit as well. Through searching for information you have surely come across ads for different Credit Service Agencies that make various claims of helping you remove negative and inaccurate items. For a fee of course. You may have even talked to one or more of them, done your online research and read complaints, reviews and checked a BBB rating to see that a lot of them have F’s. They all must be bad right? No, not all of them.
I’m not writing this to push you to a particular credit repair company. I’m not going to call out any names for good or bad. This is just like everything else you find on Smart Credit Building, education to help you make good decisions in areas you are not an expert. The National Association for Credit Service Organizations is a great resource for finding a reputable company.
Let’s start off with some basics.
- You can do everything a credit repair company does yourself. You have the right to do so, and with the internet the ability to find all of the information. You can find most of it on this site. With that being said, did you build your own house, do you butcher your own cows, do you do your own taxes, your lawn, or you auto maintenance? Ok, some of those you may have said yes, but the point is there are professionals and sometimes it is worth the price you pay to have a professional with the proper tools do the work for you.
- Credit repair is not magic. Anyone claiming to be able to “remove all negative credit items” is lying. That may be a little blunt, and I don’t like to call anyone a liar, but…
- Cheap does not always equal good. The cost of credit repair services varies drastically. Some companies advertise fixed rate pricing and others will tell you it is based on what they have to work on. Fixed rate is great for budgeting, but think about that in depth for a second before you pull the trigger. If you have 20 items to work on and someone else has 3, do you think your 20 will get the same attention?
- You have to put in work too. Having positive credit lines that you are paying is absolutely imperative. If the company you are talking to does not mention or discuss positive lines, you are talking to the wrong person. By not having or establishing a good tradeline all credit repair companies will have poor end results if you base your results solely on credit scores.
- Time is of the essence. Be diligent in what you are asked to do. Rely on the professional, and adhere to any timelines to accomplish particular tasks. Some companies will have you send them creditor/collector responses. Be sure to do that. It allows them to be as efficient as possible and serve you better.
Now you have some basic expectations. This will help you if you choose to hire a credit repair company for assistance. A few other things to keep in mind. Credit repair companies cannot charge you up front fees. This often gets misconstrued as they cannot charge anything until they are done. The truth is if they have talked to you, looked at your credit, met with you, set your file up for work, or given you any piece of information, they are allowed to charge for that service because the service was already performed. Most will give a free consultation and then charge an initial or first work fee when you enroll in their program to cover the services they have already performed. This is not a violation. There will typically be a monthly fee as well. The ranges we have seen are from $59-$129 per person. In most cases this covers the cost of outgoing and certified mail, the ongoing expenses of servicing your file, and are charged one month in arrears.
Do your homework, arm yourself with information, and don’t believe everything you read on the internet about how bad they are. A lot of times the complaints come from people that missed the fourth bullet point above and want to blame someone else.