- 6 min read
- Review your credit report, frequently
- Use DIY techniques to clean up your report.
- If you have serious debt problems, resolve your debt, then work on your credit.
Credit Help Services to the Rescue
If you are in icy water, then you definitely need professional help. The same is true if you are having serious credit problems. There are credit help services that can improve your credit report, but only up to a certain limit. When dealing with any risk, make your motto: Be Prepared.
Credit report problems become critical when you apply for a loan and the lender denies your application due to mistakes on your credit report. Before you look for credit help services, take these steps:
- Step 1: Review Your Credit Report
- Step 2: Start with Do-it-Yourself Actions to Improve Your Credit Report
- Step 3: Review Credit Help Services
Quick tip #1
If your credit score is low and you have large credit card debt, then a debt settlement program may be best for you. Contact one of Bills.com's pre-screened debt providers for a free debt relief quote.
Step 1: Take out and Review Your Credit Report
You are entitled to a free credit report once a year from each of the three big consumer credit reporting agencies, TransUnion, Equifax, and Experian. These reports include all of your recorded credit history, but do not come with your credit score.
It is important to review your credit history because it contains personal information including your place of residence, place of employment, public records (judgments), and a record of your loans and credit and how you pay them back. Credit agencies compile this information on your credit report. They sell this information to lenders, landlords, employers, and insurance companies, who make important decisions about your life.
It is common to find mistaken items recorded on credit reports. Be alert for any information about accounts that you do not recognize or apply to you. This can be due to misspelled names, similar names or social security numbers incorrectly recorded, duplicate items, or items that have been settled and not updated.
Quick tip #2
Get a free, with a 30-day trial period, credit report with your credit score.
Step 2: Do any DIY Actions to Improve Your Credit Report
The Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) are government bodies that regulate the credit agencies. Both recommend you monitor your credit reports and dispute any errors you find yourself.
Here are the steps in a credit dispute process:
- Read your credit report and identify the mistaken items.
- Send, in writing, a dispute letter to the credit agency.
- Receive a response from the credit agency. The credit agency must investigate, unless it deems your dispute frivolous, within 30 days.
- The credit agency sends to the lender or reporting company all documents relating to the dispute. If the reporting company cannot verify the information, then the credit agency must remove the disputed item.
- The credit agency sends you a written report regarding your dispute. If a change has been made, then the credit agency must provide you with an updated credit report.
- If the dispute was unsuccessful, then you can request, usually for a fee, that the credit agency provide copies of your dispute to anyone pulling your credit report.
Step 3: Review Credit Help Services
You can do credit repair by yourself. Both the FTC and CFPB recommend you do not hire a professional service. However, some people have benefited by using credit repair companies.
Here is what the CFPB writes about credit disputes:
"You don’t need a credit repair program to dispute errors in your credit report. You can do this yourself. Copies of your credit report will include information about how to dispute inaccurate or incomplete information. For more information, please visit the Federal Trade Commission’s website or call 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. No one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete. There is no charge for this. Some people hire a company to investigate on their behalf, but anything a credit repair clinic can do legally, you can do for yourself at little or no cost."
Credit Help Services
There are many services offered that you probably can do yourself, but you choose to seek professional assistance. Credit dispute takes time and organizational skills that not everyone has. Here are some of the services provided by credit repair companies:
- Free consultation to review your credit report
- Understanding of consumer law
- Communication, record keeping, and perseverance
Credit Help Companies — Review the Contract
As any service, you will pay a credit help company for services rendered. Before signing a contract, make sure, you know your rights and receive a copy of the "Consumer Credit File Rights Under State and Federal Law." A credit repair company cannot charge you before they complete promised services. They cannot make false claims, for example promise to delete accurate information. Your contract should include details about all the services that the company will provide including the costs, the time it will take to complete, and guarantees.
Before signing with a credit repair company, review its Web site and customer service support. An efficient and clear system will save you time and stress.
The Dispute Process
Once you sign up, the credit repair company will set up an online account and request that you upload your credit report. You choose the items to dispute. The credit repair company will then take actions to dispute inaccurate or questionable information. They will update you through your online account and by email, online chat and phone.
Avoid a Scam
Unfortunately, there are shady companies offering credit repair. The FTC has provided some good hints to tell if you are dealing with a legitimate company. Here are some of the points:
- The company asks you to pay before services are performed.
- The company does not inform you of your rights.
- The company dissuades you from contacting a credit agency by yourself.
- The company tells you that you can get rid of accurate and current negative information.
- The company tells you to dispute every negative item.
If you have problems, then file a complaint with the CFPB or the FTC or your state’s Attorney General.
On-line Credit Help Review
You can find online reviews of many credit repair companies including Lexington Law, Ovation and Sky Blue Credit Repair. Check the BBB for the companies rating and rate of resolving complaints. Read the Bills.com article about a credit repair company, Lexington Law, including readers’ comments (positive and negative) about their experiences. Remember, a professional credit repair service cannot remove accurate negative information.
Credit Help Services — Beyond Credit Repair
Credit repair does not resolve debt problems. Accurate, negative items remain on your credit report.
Poor credit reports and score are a symptom of larger financial problems. Poor budgeting, emergency expenses and loss of income are all causes of not meeting your bills on time. Pulling yourself out of those icy waters can become a formidable task. There are different debt relief solutions, depending on your financial situation. You can find professional credit help services including credit counseling, debt management, and debt settlement companies.
Quick tip #3:
To find the best debt relief option for your situation use Bills.com Debt Coach tool. The Debt Coach helps you analyze your financial situation and recommend one of five debt relief options.