While it might seem like a good idea to pay someone to fix your credit reports, there's nothing a credit repair company can do for you that you can't do yourself for free. Having a good credit score is important. Without it, you may be denied low-interest loans and lines of credit, a job, a rent, and even an insurance policy. If your credit report shows a history of debt problems or contains errors, you may consider using a repair service to “clean” it.
However, before you pay, know how these companies work. In the vast majority of cases, hiring an external company will only waste your money. You can repair the credit yourself. How successful you are depends on the complexity of your situation.
Credit repair takes time and a lot of research if you start from the beginning. But if you are ambitious, you can certainly repair your credit yourself. It is entirely possible to repair your credit without paying credit repair companies. In many cases, it is preferable to rebuild credit on your own.
Once you have the EIN, you will be prompted to apply for a new credit with it, so you can create a completely new credit history. Keep in mind that there is nothing a credit repair company can do for you that you can't do on your own. The goal of these companies is to build their credit by disputing outdated or incorrect information in their credit reports, tracking results, and monitoring to ensure that errors don't reappear. If the only negative notes on your credit report are errors that can be successfully disputed and eliminated, you're likely to see an improvement in your credit score fairly quickly.
Many credit repair companies circumvent this rule by offering subscriptions through which you pay each month for services performed in the previous month. By law, a credit repair company must provide you with a contract describing the services it will perform on your behalf. Most credit repair companies charge a monthly fee and offer several packages ranging from basic to advanced. Credit scores are calculated based on information in the consumer's credit report, and sometimes that information is inaccurate.
Automatic credit repair involves checking your credit, disputing any mistakes, and working hard to repay the debt and create a history of on-time payments. Credit plays a huge role in your life; you may not realize how important credit is until you reach adulthood. This is where the credit repair service asks you for an Employer Identification Number (EIN) from the Internal Revenue Service, which has the same number of digits as a Social Security number. While credit repair is a legal industry, there are specific federal guidelines that regulate what companies can and cannot do.
They work with credit bureaus and creditors on your behalf to eliminate errors from your credit report. You can find ads for free credit repair companies, but this usually just means that you will receive a short free consultation. Not only will this help you improve your payment history, but it will also improve your credit utilization rate, which is one of the most important factors in determining your credit score. If the information is accurate, there is little that anyone, even a professional credit repair company, can do little to change it.