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What You Should Know Before Using a Credit Repair Company
by Terry Price
Have you ever wondered about those ads you see from companies and law firms
which offer to fix your credit for a low monthly fee? People with credit
problems often ask me when it comes to improving their credit score whether they
should hire a credit repair company or do it themselves? Unfortunately, there is
no simple or universal answer to this question. However, I will shed some light
on the subject if you're in need of a little enlightenment.
According to the Federal Trade Commission (FTC) "Everything a credit repair
clinic can do for you legally you can do for yourself at little or no cost".
While I agree with the FTC I also understand some consumers do not have the
time, patience (or knowledge) to do the work themselves and the thought of
"drive-thru we-do-it-all-for-you credit-repair" becomes very appealing. After
all, everything a mobile oil change service can do for me I can also do myself
at little or no cost (but you won't find me changing the oil in my car this weekend!).
Although some things are better done yourself, only you can determine if doing
your own credit restoration work will be one of them. This is why understanding
both the advantages and limitations of a credit repair company and the structure
from which it operates are VERY important.
References: Any legitimate company or individual doing credit restoration
work for consumers will be able to provide you with at least half a dozen
references. If the company or person is local you should be able to call these
references. This is without question the most important point of consideration
when hiring a professional to do the work for you.
If possible, I suggest you ask friends, family, relatives and professional
contacts if they know of someone who does credit restoration work as a side
business. By far the highest percentage of successful stories I hear from
consumers are those which come from those who found a credit consultant via
personal referral. I cannot stress this enough. It's the difference between
going on a vacation with a close friend instead of a stranger.
Contract: Unlike painting a house or putting in a driveway, credit
restoration work (and results) are extremely broad. Therefore, the use of a
contract is imperative. Most likely your credit challenges didn't occur
overnight and they won't be improved overnight either. A good contract protects
you as well as the service provider. The contract should be easy to understand
without an Attorney and spell out the actual services which will be rendered as
well as the service providers' limitations (i.e. they cannot guarantee the removal
of any one particular item but can guarantee an overall increase in score overtime).
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