Having a good credit score is more important than most people think, because of the impact it has on our lives.
It is a snapshot of an individual's credit health and helps lenders and financial service providers understand the credit worthiness of that individual. Whether you're applying for a credit card, a loan, or even a job, your credit score is one of the first things that is checked. This probably explains why credit repair services are becoming so sought after these days.
Although the idea of outsourcing your credit repair activities to a third party might be enticing, there are a few things that you need to understand first. For instance, when you search for the best credit repair in Houston, there are a number of companies that show up. So, how do you make the decision about which one to go with? What should you expect when you go to a credit repair company?
Let’s examine credit repair and if using a credit repair company can raise your credit score.
Consumer credit scores are determined by a number of factors. More specifically, they are calculated based on the information in the consumers’ credit reports, including whether bills are paid on time. However, sometimes this information is not correct. This can happen if creditors give the wrong information to the credit bureau or if an identity has been stolen and the thief takes out credit in the consumer’s name.
Credit repair is the process of fixing these errors. The practice is covered by the Fair Credit Reporting Act (FRCA) and gives every person the right to dispute any inaccurate information on their credit report.
A credit repair company communicates with credit bureaus and disputes inaccurate information on an individual’s behalf. They fight to remove the negative information from a credit report. If they are successful, the removal of this information will ultimately improve the consumer’s credit score.
Consumers often want to know if credit repair companies are legal–the answer is: yes. It doesn’t matter if you do it yourself or hire a service, credit repair is permitted under federal law and in all fifty states. In addition to the FRCA, the Credit Repair Organizations Act (CROA) governs and regulates the services provided by credit repair companies.
Credit repair can take as little as thirty days or up to one year to complete, depending on the number of errors on a credit report. It is most definitely a process that requires a lot of patience and perseverance, which is why credit repair experts such as those at The Phenix Group can help make the process a breeze and let you know how long your credit repair will last.
A credit repair company will start by asking the consumer for their credit reports from the three major consumer credit bureaus: Equifax, Experian, and TransUnion. The company will then review the credit report for:
After a thorough review of the credit report, they will then suggest a plan for disputing errors and negotiating with creditors to remove any inaccurate information that negatively impacts your score. The plan often includes the following elements:
Requests to validate information
Letters to dispute erroneous negative marks
Cease-and-desist letters to debt collectors on your behalf
Once the issues are resolved, credit repair service providers may offer continual credit monitoring services to help you keep a check on any new erroneous information that may arise in the future.
By following the process outlined above, credit repair companies examine and attempt to rectify any erroneous or misleading information in the consumer's credit report. They have experience dealing with credit bureaus and know how to get negative items removed from a report.
One of the most important things that credit repair companies do is help you build a good credit history–this includes helping you establish a solid payment history, which consequently increases your credit score. Further, they can also help you learn how to use credit wisely so you don't damage your credit score again in the future. Professional credit repair experts at The Phenix Group are ready to help you navigate the world of credit repair and get your credit health back on track today.
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