Method #2
Credit Repair Companies
Some Credit Repair Companies Are Great,
Some Are Terrible. I'll Tell You Why And Then Which Companies Are The Best
Intro:
I'm sure you've seen the advertisements in the newspaper, on TV, and certainly all over the internet.
You know the ones I'm talking about. They make claims like:
- "Credit problems? No problem!"
- "We can erase your bad credit -- 100% guaranteed."
- "We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!"
Featured Product #1
Can they really do this though?
Actually, Yes...they can.
The two primary concerns you should have are not whether:
- They can do what they say they can do or
- If companies like this are legal.
Instead your concerns should be:
- Is this particular company legit or a scam and
- Is the price that they are charging fair or way too high?
Personal Experience:
I should know about credit repair companies. I've used one before myself.
They were able to remove quite a few negative accounts from my credit reports.
They didn't remove all of the negative accounts I had at the time, but that wasn't their fault. I simply didn't keep them
employed until they had completely removed all of the bad accounts.
Their monthly payment for their services was $69 and I was at a point in my life where cutting back on my bills became my priority.
So, out they went.
And, really, the price is usually the main reason why someone doesn't use or quits using a company or a law firm
that provides credit repair services.
If you look at the big picture though, the $69 a month and their initial start up fee was chump change compared to how much of a
difference they were going to make for me in interest payments later down the road on loans and credit cards.
I simply made the same kind of mistakes that most people make:
- I looked at the short term monthly payment as opposed to the longer term savings in interest and
- I lost focus on the goal of getting and keeping good credit because I got distracted by the other things going on in my life.
Pros:
- Thousands less than the Time method where you will waste your money due to higher interest rates.
- You will not have to read a really long course about credit repair.
- Far more effective than following the Credit Bureaus’ Instructions.
- Much faster than waiting months and years for your negative credit accounts to reach their termination
date and fall off your reports automatically.
- The company will write all of the dispute letters for you.
- If they are a good credit repair service company, they will know and use the latest techniques.
- They will keep track of each account and whether its been cleared or needs to be challenged again.
Cons:
- You end up doing as much or more work as if you did it yourself.
- It's the most expensive of all five methods of bad credit repair.
- It will take lot longer than if you do it yourself.
- More than one of your legal rights to dispute negative accounts is lost when you give someone else the authority to do it for you.
- The company might not be legit and you end up spending money with nothing to show for it.
Additional Details:
Now some experts will tell you not to do it. They'll tell you to not work with a credit repair service company. And, I admit,
that the negatives aren't so great.
But I'm not actually against them for two reasons:
First, since I've used one before and saw the results I know that they do in fact work.
Second, if you've got the money to pay for the services, they will essentially keep you on track and moving forward when it can be so easy
on your own to get lazy and not take the next step in the process.
If you know that you aren't organized enough to stay on top of it, or motivated enough to stick with the game plan all the way to the finish,
then the credit repair service companies do have a valid argument for being the method of choice.
But, let me emphasize a couple of the negatives. Although it's tempting to simply pay a company to do the work for you, most of the credit repair
companies have a couple of weaknesses that they don't want you to know about.
First, because most charge you a monthly fee for their credit repair services, its really not in their best interest to get the job done as fast as possible.
I'm not saying that they all drag their feet like this, and choosing one of the more reputable ones should avoid this problem, but it's still a factor
to be aware of when considering a company.
Second, there is still a good amount of effort on your part. Its pretty much a no brainer, but the work still has to be done by you.
And just so you know, the primary work that's involved is:
- Filling out several forms (including Power of Attorney documents),
- Receiving and forwarding all of the credit reports and other documents you get from the credit bureaus to the credit repair company.
The reason you have to do this is because these documents are not legally allowed to be sent to anyone else but you.
Personally, I don't consider having to remail all of my credit report updates on to the credit repair service company to be a paper shuffling job that
will kill me.
Recommendations:
I've studied several different credit repair companies. There are quite a few out there and I've by no means studied up on them all.
But I really don't need to either.
There are only a few that are worth considering.
I've put together in depth reviews of the 5 main companies in the credit repair industry and highlighted the strengths and weaknesses of
each of them for you to consider.
Of these 5 I would say you should pick one of the top 2, if for no other reason than that they are less expensive. Even when you
get down to the top 2 companies though, I still feel that one company is the clear winner.
So, here are the top companies and the order in which they rank:
I've also put together a
Company Comparison Chart
of the best service plans of each of these 5 companies for you. This chart should help to give you more of a visual for how these companies compare to each other.
Conclusion:
Credit repair service companies really can do what they say they can do and they are legal.
The concern should be if the particular company you're looking at is legit and if they are charging a fair price. If you do a search for "credit repair companies,"
you can feel confident that the companies that pop up at the top of that search are legit.
As for the price, credit repair should not be more than a total of about $500. If you're being charged more than that, then the company could
still easily be quite legit, but why go with them when there are companies that can provide the same services for less?
All of the companies I've recommended throughout this site will be found at the top of any search you might conduct will charge reasonable prices.
Still, I feel that this the 2nd best method of repairing your credit. There are pros and there are cons, but the cons are not necessarily show stoppers.
That being said, there's more than one reason as to why I think this is the 2nd best method and not the best one.
So, let's move on to my favorite and I'll give you the details you need to see for yourself why I believe it's the best method to use to restore your
bad credit.
Featured Product #3
