"Get the credit score you deserve"
How Does the Credit Repair Business Work?
“Credit repair leverages your legal right to three standards: Credit reports must be 100% accurate, entirely fair, and fully substantiated,” A good credit repair service can help you do something you may not be able to accomplish yourself. If you have a collection account that’s been sold to a few different debt collectors, it may appear on your credit report multiple times. That information is accurate, but having that one debt dinging your credit score multiple times does not meet the “fair” credit report standards.
If you have items on your credit report that don’t meet the three standards you should consider credit repair. (Errors are more common than you may think: a Federal Trade Commission study found that 1-in-5 consumers have an error on at least one of their credit reports. Most credit repair professionals suggest pulling your credit reports for errors 12 months.
What Do Credit Repair Companies Do?
A good credit repair company will pull your credit reports from Experian, TransUnion and Equifax to pinpoint your credit issues. Why all three? Because each credit reporting agency has its own “data furnishers” (aka lenders, credit card companies, debt collectors, etc.) who report your credit information to them. And there may be errors that appear on one of your credit reports, but don’t appear on the others.
Once those errors have been identified, you’ll then give a credit repair company any supporting documentation you might have or need. For example, if there’s a bill on your credit report that you are not responsible for, you can use that document to prove it shouldn’t be impacting you.
In some cases, it might be difficult to determine what to include as far as supporting documentation goes — that’s another way a credit repair company can help you. For example, if you’re a victim of identity theft and a fraudulent account is appearing on your credit report, it can be tough to prove it isn’t yours since you naturally don’t have any documents relating to the account.
When the bureaus and data furnishers receive the dispute and supporting information, they will then work with the credit repair company to determine if the item should be removed from your credit report. The major law dictating your rights when it comes to credit reporting is the Fair Credit Reporting Act, but it isn’t the only law on your side when it comes to credit repair.
“A good credit repair company will scrub questionable credit report items against other laws — like the Fair Credit Billing Act, which regulates original creditors; the Fair Debt Collection Practices Act, which oversees collection agencies; and others that address medical illness, military service, student status and other life events,”
How Long Does Credit Repair Take?
Getting negative, inaccurate information removed from your credit reports is one of the fastest ways to see your scores improve. Since credit bureaus must respond and resolve a dispute within 30 days (there are a few exceptions that may extend this to 45 days), it’s a short timeline that can help you as a consumer, who want to buy a house, get a new car or open up a new credit card soon and don’t have the time to wait to build good credit in other ways.
But that doesn’t mean a credit repair company can tell you exactly when your credit score will improve since some consumers’ credit issues are much more complex than others.