A consumer contacts a reputable credit repair business.
There are a lot of advertisements for credit repair businesses; unfortunately, some of them are not reputable and instead of helping a consumer they instead set out to fleece him. If you are thinking of hiring a credit repair business, check out its reputation first with the online Better Business Bureau (a link is provided in the Resources section) and also by asking friends and family members, who may have used similar services, for a referral.
The credit repair business works as middleman between consumer and credit bureau.
A consumer with derogatory items listed on his credit report may wish to dispute these notations. Sometimes he may not feel comfortable doing so, while at other times he may have attempted in the past to get the items removed, only to see them crop up again later. If you are in this position, then hiring a credit repair business to act as your middleman is a good idea. The credit repair business contacts the three major credit bureaus on your behalf and then goes through your credit report line item by line item to dispute the erroneous information.
The consumer pays a monthly fee to the credit repair business to maintain a correct credit profile.
The credit repair business may charge an initial setup fee that covers the labor involved in correcting the credit profile at all three credit bureaus. Thereafter you pay a monthly fee, and the credit repair agency will be available to receive your credit profile and contact the credit bureaus if erroneous derogatory information is noted in your file. This consistent vigilance will keep your credit report error-free and in some cases cause your FICO score to rise dramatically as a direct result of the intervention.
A credit repair business cannot erase correct information.
Understanding how a credit repair business works requires you to know about the tasks it cannot accomplish. A credit repair agency cannot get derogatory information that is correct removed from your file; in addition, the agency does not have the right to obtain your credit report for you. Instead, you must provide the report to them and highlight the information that is incorrect. Moreover, a credit repair contract will not automatically result in a higher credit score or erase debts. You still owe all of your outstanding debts and own all of your bona fide bad marks on the credit profile.
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