Does Credit Repair REALLY Work?

You see the advertisements every day, "Clean up your Credit" or "You can have Spotless Credit" or "Enjoy top Credit". These are the promises of Credit Repair companies and perhaps you have considered hiring one. Before making your decision lets examine what they are and what they can do for you. The first and most important thing you should know is that no credit repair company can guarantee 100% success in their efforts to clean up your credit report. Credit Repair companies are bound by the same laws that you are so the only difference between you and a Credit Repair company is that they know how to use the credit laws to their advantage.

Credit repair companies charge from several hundred to several thousand dollars for their service and because of the vast amount of money that can be made and the large number of people that need credit repair services, this is a business that attracts many con artists. Many credit repair companies open up for business, do a great deal of advertising, collect large amounts of up front fees and then abruptly close the business without doing the work they promised. If you choose to work with a credit repair company be sure that they have been around for a while. Call the Better Business Bureau to check them out and ask for references from the company.

A legitimate credit repair company will carefully explain your rights under the credit repair laws. They should tell you what results you can reasonably expect and not simply promise to clean up your credit. If a credit repair company tells you otherwise, they are making exaggerated claims. If you deal with one of these companies be very careful to determine exactly what they will do for you. Many times you will find that they offer a guarantee which states that they will "improve your credit or your money back". This sounds great until you discover (after spending a lot of money) that all this guarantee says is that they will make your credit better than it was before you went to them. The trick here is that all they have to do is get one late payment removed or changed from a 60 day late to a 30 day late and they have lived up their guarantee since your credit has in fact been "improved", although the improvement is trivial. The moral of this story is - know who you are doing business with.

Robert M. Sriberg, Vice President
Debt Negotiation Services