Should I Hire a Credit Repair Company?
Unfortunately, many people who have bad credit don't even know that hiring a credit repair company is an option. As unfortunate as it is the fact that many people who know that credit repair companies exist think they are all scams. Many consumers also confuse them with credit counseling services and debt consolidation services; which they are not. Well, I happen to know of some great credit repair companies, so I am here to set the record straight!
You should only consider hiring a credit repair company if you have many collection accounts, charge offs or public records such as judgments, repossessions, foreclosures, and bankruptcies. If you only have a few bad accounts on your credit report, you should try contacting the credit bureaus and creditors yourself. You should also work on rebuilding your credit if you don't have many or any positive accounts reporting.
I would suggest choosing a well-known agency online, but if you decide to go local, make sure to check with your local Better Business Bureau and state attorney general for any filed complaints. The upfront setup fees should be very minimal. Under the Credit Repair Organizations act, a credit repair company is not permitted to charge before they provide any services. This is one of the most important things to consider when hiring a credit repair company because it ensures that you won't be out a lot of money if they are unable to repair your credit.
Credit repair companies must follow specific guidelines from the Credit Repair Organizations Act. Congress introduced the CROA in 1996 to protect consumers from unfair and deceptive business practices and advertising by credit repair organizations. It's wise to at least browse over the CROA before hiring a credit repair company.