You probably already know just how important your credit score is and how this three-digit manifestation of your credit health can affect your life. Without a solid credit score, you may struggle to get your own apartment, buy a home, or finance a car, for example — and that’s just the beginning.
If your credit has been damaged due to late payments, debts in collections, or neglect, credit repair may be exactly what you need. You can work to improve your credit yourself or you can hire a firm to help. A good credit repair company can work as your advocate, educating you about your credit score and how it’s determined. They also work to improve your credit on your behalf, usually by negotiating with creditors and credit bureaus to remove negative marks, resolve issues and help you repair your credit — once and for all.
Unfortunately, there are numerous credit repair scams to be aware of. Some credit repair companies will ask for money upfront, while others will ask you to take unethical steps, such as disputing accurate information on your credit report. Any time a company promises you a “new credit identity” or asks you to give false information, run the other way.
Fortunately, credit repair companies are governed by the Credit Repair Organizations Act (CROA). This law requires credit repair companies to take certain steps, including informing you of your legal rights, giving you three full days to cancel your contract and letting you know the full costs of their services upfront. The law also gives you options if a credit repair company doesn’t live up to its promises, including the ability to sue them in federal court, the ability to seek punitive damages, and the right to join a class action lawsuit against the company.
If you’re ready to repair your credit, a reputable credit repair agency can help. Keep reading to learn more about how these companies work and what to expect.