Can a Credit Repair Service Help Improve My Credit Score?

Everything You Need to Know About Credit Repair & How to Choose the Right Service

Your credit score can impact your life in some very profound ways. A poor credit score may prevent you from opening a credit card, buying a car, renting a home, and may even limit your educational or career plans.

Roughly 68 million adults in the US—a third of the entire scorable population—have a bad credit score (anything below 601). This massive reserve of consumers gave rise to a new industry in recent years: the credit repair business. But, can credit repair companies really deliver what they promise?

What is Credit Repair?

Many people with negative credit reports feel that the problem is due to errors in reporting. This is possible; according to the FTC, 1 in 5 Americans has an error on their credit history.

For example, you may have an old debt that’s been sold to multiple different collectors over the years. It’s possible that this will have been reported multiple times, even though it is the same debt and should only be listed once. Credit repair businesses will charge a fee to identify and remove these errors from your credit report to improve your credit score.

According to the companies that provide this service, credit repair will quickly pay for itself: as your credit score rises, you have easier access to credit. In turn, you will pay lower interest rates and fees for credit cards, auto loans, and insurance, which offsets the cost of the credit repair company’s service.

While consumers are free to conduct this work themselves, it can be a very complicated, time-consuming process. Most don’t have the expertise necessary to identify errors on the part of the credit bureaus, as well as on individual creditors. Credit repair companies allow you to outsource this work so you can use your time and energy more productively.

Know Your Rights

You should understand what a credit repair company and cannot do, as well as the rights guaranteed to you under US federal law before signing-on with any service provider. Whichever service you choose must:

• Provide a written contract listing out the specific services provided.
• Offer you a copy of the full Consumer Credit File Rights Under State and Federal Law.
• Allow a three-day window after signing for you to cancel if you choose.

In addition, the credit repair company CANNOT promise, recommend, or engage in any of the following practices or behaviors:

• Discourage you from contacting the three credit reporting bureaus (Experian, Equifax, or TransUnion).
• Advise you to dispute all information in your credit report.
• Lie or falsify evidence to remove accurate, but negative information from your report.
• Alter or otherwise falsify your identity to hide your credit history.
• Accept payment from you until they fulfill all the conditions of the contact. No upfront fees unless already stipulated.

Selecting the Best Service for Your Needs

So, looking to hire a credit repair service, but not quite sure where to start? Don’t rush into anything; remember, anything related to your credit is very sensitive, and you should not take it lightly.

To help with your decision, check out our roundup of the top five credit repair services of 2017 as ranked by Simple.Thrifty.Living:

Company	Monthly Fee?	Setup Fee?	Features
Lexington Law	$79-119	Yes	·         Three tiers of service: 1. Basic credit repair. 2. Credit repair plus credit monitoring & analysis. 3. Credit repair & monitoring, plus identity fraud alerts. ·         In-house legal advisors. ·         Strong reputation with comprehensive customer service. ·         Month-to-month service, cancel anytime.
Sky Blue	$59	Yes	·         Basic, but effective credit repair services. ·         Strong reputation with comprehensive customer service. ·         Month-to-month service, cancel anytime. ·         90-day satisfaction guarantee with full refund.
Pyramid Credit Repair	$99	No	·         More comprehensive credit repair services. ·         Provides a dedicated personal account manager for customers. ·         In-house legal advisors. ·         Strong reputation with comprehensive customer service. ·         Month-to-month service, cancel anytime. ·         90-day satisfaction guarantee with full refund.
The Credit People	$69	No	·         Basic, but effective credit repair services. ·         Month-to-month service, cancel anytime. ·         Six-month satisfaction guarantee with full refund.
CreditRepair.com	$99	Yes	·         More comprehensive credit repair services. ·         Strong reputation with comprehensive customer service. ·         Month-to-month service, cancel anytime.

 

Choose Wisely

The credit repair company you choose will depend on your specific needs and what you hope to get out of their service. Whether you want basic service to repair damage to your credit score, or more comprehensive services that can mitigate future risks, the answer is up to you.

Before you decide, though, remember to ask questions, and ensure that you fully understand what you’re buying.