Jan05
Credit Repair Companies: Why you shouldn’t have to Pay for Repairing your Credit
The tough economic conditions this past year have left millions of consumers in financial straits. From the effects of the recession and credit industry to the tumbling housing market, credit card consumers across the country are finding it difficult to keep up with their credit card payments and are slowly destroying their credit in the process.
If you have been a victim of the economy and you are drowning in a sea of credit card debt, you may be tempted to contact one of those credit repair companies you often see advertising on television, radio and even on billboards. They often offer to repair your credit so that you can get approved for a car loan, a home loan or personal credit.
It may sound quite tempting, actually. The thought of paying a company to pull a quick fix on your credit may just solve a host of problems. But before you jump into the arms of one of these credit repair companies, there are a few things you should consider:
• No one can legally remove information from your credit report. Regardless of what these companies may promise you, it is simply illegal to have any information removed – unless, of course, you find an error or discrepancy, in which case you must request an investigation by the appropriate credit bureau.
• The only thing that will remove your bad credit rating is time – and responsible credit behavior. Your negative credit card information can only be reported for seven years (bankruptcy is ten years). Unpaid judgments go back seven years, or until the statute of limitations ends.
• Improving your credit score can only be accomplished one way: paying off your debt. In other words, instead of trying to hide from your creditors, contact them and set up a reasonable payment plan, if possible. You will feel relieved to end the stress of avoiding the creditor, and you will immediately begin repairing your credit.
• If you choose to contact a credit repair company, make sure you receive the brochure, “Consumer Credit File Rights under State and Federal Law.” This brochure should clearly outline the company’s fees, as well as your rights and obligations.
• Consider seeking help through a non-profit consumer credit counseling service, which is almost always free of charge.
