You don’t actually want credit repair, credit repair services, or credit repair companies. No one does.
Instead, you have a goal in life and a credit problem stands in your way.
So, you’ve looked for a solution to that credit challenge and you’ve discovered credit repair.
Unfortunately, that’s the beginning of the challenge:
- Hire a company or do it yourself (DIY)?
- Which companies are best?
- Which credit repair services work?
- How to avoid scams and ripoffs?
Fortunately, if you’re on this page, that challenge just ended.
We will explain credit repair and how to 100% guarantee you will get exactly what you pay for no matter which company you hire. (Hint, use Credzu’s escrow service, described below.)
Definition and purpose.
Without all the nerdy financial jargon:
Credit repair is a process to correct errors in your credit reports.
Obviously, it can get more complicated than that. But, at the end of the day, the ultimate goal is an accurate credit report.
When you hear about “removing negative credit” information from credit reports using “consumer protection laws,” it’s still just correcting credit reports.
In fact, the primary law used to improve credit is called the Fair Credit Reporting Act. It gives you the right to challenge (and have credit bureaus remove) outdated, inaccurate, obsolete, or misleading information in your credit report.
Most people believe you can remove accurate negative information. But, you cannot.
It can be very difficult to identify inaccuracies in credit reports. This is a reason to hire a company.
A credit repair company is almost always more prepared to correctly identify and successfully challenge inaccurate information in credit reports.
So, what’s a credit repair company?
Credit Repair Companies.
Again, without all the monetary slang:
Anyone who helps you correct your credit report, for a fee, is a credit repair company.
You know those rights you have to an accurate credit report? Well, a third party can help you exercise those rights.
So, how do you find a good one?
Best credit repair companies?
What does it really mean to find the best credit repair company? It should mean a company that will lead you to credit success without all the shenanigans. The industry has many bad actors.
People try to find the “best credit repair companies” for many reasons.
Among other things, they want to:
- Reduce their risk of being ripped off.
- Increase their chance of improving their credit.
- Find the best deals.
- The fastest results.
Here’s what you’re likely to do (and what you should do) when trying to find the best credit repair company for your credit goals.
Ranking and reviews.
People rely on search rankings and review sites for recommendations. This is not necessarily a good idea.
You should know something. And, it’s a bit controversial.
There’s nearly no connection between the quality of a company and its “ranking” in Google or third-party review sites.
The criteria of the review sites often have to do with compensation. The criteria of ranking in google relates to backlinks, social shares, etc.
- If you’re trying to find a good company by searching “credit repair company reviews,” all you’re going to find is companies trying to get you to click on their sites so they can benefit from the traffic.
- If you’re trying to find a qualified company to do your credit repair by searching “top X credit repair companies” in Google, all you’re going to discover is, well, the companies with the best search engine optimization and marketing.
In order to make sure you and your money are protected, you’ll want to engage a third party, like an escrow agent (explained below).
Credit repair companies “near me”.
Often people search for companies “near me” in Google. This brings up the map and shows companies literally near you.
This is not a bad idea, because you can literally walk into their office and see people face to face.
Clearly, issues are easier to solve in person as opposed to a faceless, emotionless email.
Even so, this doesn’t ensure that issues are solved.
Word of mouth.
The good thing about word of mouth is that someone before you went through the rigmarole to find a qualified credit repair company.
While this is good, someone’s past success with a company does not mean a particular service will solve your particular credit problems.
Additionally, sometimes word of mouth recommendations are made merely because someone knows someone else.
Meaning, it might not be a “this is the best credit repair company” recommendation. Rather, it might be a “this is a credit repair company” recommendation.
Credit Repair Services.
So, correcting credit reports is credit repair.
People who do that for you are credit repair companies.
But, what credit-related services exist?
Types of credit repair.
Can we expand the definition of credit repair for a second? Let’s call it correcting credit reports and improving credit scores.
In that way, there are a lot of services that could be classified as credit repair.
Removing negative credit.
The most traditional method to improve credit is the disputing process, which – basically – works like this:
- Get your credit reports.
- Identify errors.
- Write the credit bureaus (or creditors) and ask them to investigate and fix the errors.
- Check for updates.
The objective is to remove negative information if it is erroneous. Removing negative information in your credit report can increase your credit scores.
Adding positive credit.
Other forms of credit repair include adding positive credit (rather than removing negative credit) to increase credit scores.
Here are three examples of adding positive credit information to enhance credit scores.
Adding authorized user tradelines.
There is a law (the Equal Credit Opportunity Act) and a rule (the Federal Reserve’s Regulation B) that allows spouses to add each other as authorized users on each other’s credit cards.
Provided that the credit card is in good standing, the spouse designated as an authorized user gets a credit boost.
Why? Because the information associated with the credit card is reported to the spouse’s credit report. This positively impacts credit scores.
Here’s the kicker: Because banks do not check who is and is not a spouse, anyone can benefit from this credit hack.
It’s called “piggybacking credit” or tradelines. There’s an entire industry dedicated to this practice.
And, it works.
But, how do you trust the people involved? We’ll tell you below.
Opening a secured credit card.
Opening a secured credit card can have a positive impact on your credit report and credit score.
However, this technique should be used sparingly.
- You do not want to add a small, new, secured credit card to an aged credit profile (it could actually bring your score down).
- You do want to use secured credit cards to start or expand relatively new and empty credit reports (this will improve or at least start your credit).
Secured credit cards can increase and decrease your credit scores.
Utility reporting programs.
A new practice has emerged where companies gather your payment information and report it to the credit bureaus.
Examples include Self Lender, Experian Boost, etc.
They take bills you ordinarily pay but do not ordinarily get credit for and report the history to the credit bureaus.
Imagine if your rent, utilities, or even your Netflix subscription all of a sudden became a “tradeline” on your credit report.
Assuming you pay on time, this will have an instant positive impact on your credit score.
Future-based credit repair.
This is a little clickbait-y, but it might be important to consider.
Services to improve credit are, obviously, a reaction to bad credit. Bad credit happened because something went wrong… in the past.
So, a preemptive, future-facing credit improvement technique is to start right now and ensure you establish and maintain good credit behavior.
Should I hire a credit repair company?
Whether you should pay someone to repair your credit is really a matter of efficiency. Obviously, you can repair your own credit. However, there are a few main reasons to pay for credit improvement:
- Your time and energy is better spent on your trade or craft that generates income of your and your family.
- An expert is going to be able to get more done, faster and cheaper than you.
- There are pitfalls in repair (such as the case when bureaus or creditors fail to cooperate with you or follow the law), with which a credit professional is more prepared to handle.
Is credit repair legal and legitimate?
Credit repair is based on the law (the Fair Credit Reporting Act, for example). So, it is perfectly legal. Congress made a law for you. That law expresses their intent that you have a legitimate interest in maintaining accurate credit.
However, you or a company could engage in illegal and illegitimate credit enhancement behavior.
There are illegal and illegitimate forms of credit repair, such as:
- Adding fake primary tradelines.
- Engaging in file segregation (which is essentially aggravated identity theft).
- Filing false police reports claiming identity theft.
- Writing false or “phantom” letters to the credit bureaus on behalf of your creditors.
If you’re concerned with legal compliance, that’s a good thing.
You should seek assistance from companies that share this concern with you. Why? Because credit repair companies are highly regulated and perhaps none of them are in full compliance with certain laws and regulations.
How long does credit repair take?
How long it takes to improve credit really depends on your specific credit challenge.
On average, traditional, dispute-based repair services can take between 3 and 9 months. 6 months is the average and it’s a logical max duration; what is going to get fixed in the 7th month that couldn’t get fixed in the first 6 months?
Side note on that: some States, like Texas, make it illegal to perform credit repair longer than 6 months.
Other services, like piggybacking credit (or “seasoned tradelines”) take about 45 days to see results.
How much does credit repair cost?
The costs associated with improving credit range widely. If you do it yourself, it’s “free.” (This depends on how you value your time). If you hire a company, it depends on which service and how many services you purchase.
Based on our observations, credit repair typically costs around $750.00, plus or minus a few hundred bucks, on average. Tradelines usually cost the same, but maybe more if you buy more than one tradeline.
Debt settlement ranges to much to give a general answer. We will not address that in this article.
Does credit repair actually work?
In a vacuum, of course credit repair works. Fixing errors in credit reports is backed by the law and increases credit scores… period.
But, it can fail, just like anything in life.
There’s two main points of failure:
- Unreasonable expectations and misunderstandings.
- Actual ripoffs and scams which plague the market.
It’s extremely important for a person to have (and a company to provide) reasonable expectations in credit-related services. A person could believe they didn’t have a good experience if a company didn’t live up to his or her expectation.
More importantly, you need to stay away from companies who will negligently or fraudulently fail to help you and your credit.
Credzu.com protects buyers and providers of credit-related services.
As it says on our homepage:
“We hold people’s money in escrow and pay companies only if they perform. No more scams. No more chargebacks.”
That’s not a slogan. That’s literally what we do:
- Force companies to put their promises in writing.
- Hold money in escrow (away from the company) until credit repair services are performed and verified.
- Release funds to the company or refund to the consumer.
This industry has long needed a disinterested third party to act as an escrow agent between buyers and sellers of credit repair services.
Now, it’s possible.