“DIY Credit Repair: How to Fix Your Credit for Free”

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What Is a Credit Repair Company?

A credit repair company, also known as a credit repair organization or credit services organization, aims to remove inaccurate and unverifiable information from your credit reports in exchange for payment. These companies may offer services such as credit assessment, credit monitoring, communicating with creditors, identity theft monitoring, credit building tools, and educational resources.

However, it’s important to note that the Credit Repair Organizations Act (CROA) imposes strict rules on what these companies can and cannot do. They cannot remove accurate credit report information, advise customers to make false statements, change identification to prevent credit bureaus from associating them with their credit information, charge fees for services not fully rendered, or guarantee the removal of information from credit reports.

How Much Does Credit Repair Cost?

The cost of credit repair services can vary. You might pay between $50 to $150 per month for a subscription service, which may also include a setup fee of up to $200. Alternatively, you could opt for a pay-per-delete service, where you are charged only when an item is removed from your credit report. Costs can range from $25 per bureau for personal information removal to $100 for a bankruptcy removal.

Should You Use a Credit Repair Company?

For most people, hiring a credit repair company may not be the best option due to several reasons:

• Cost: Credit repair services can be expensive, and the same results can often be achieved for free.
• No Guarantees: These companies cannot remove accurate negative information from your credit reports.
• Risk of Scams: Some credit repair services are scams, making it difficult to know who to trust.

If you feel overwhelmed by your credit situation, consider getting a free consultation with a credit counselor who can provide advice on managing debt and improving your credit.

How to Fix Your Credit Yourself for Free

Before considering a credit repair company, try these steps to repair your credit on your own:

• Review Your Credit Reports: Check your credit reports for any unfamiliar items. You can get free access to your FICO® Score and Experian credit report, and request weekly reports from Equifax and TransUnion through AnnualCreditReport.com.
• File a Dispute: Submit a dispute for any inaccurate information online, by phone, or via mail. Provide your identity verification, reason, and supporting documentation.
• Wait for Resolution: Credit bureaus typically resolve disputes within 30 to 45 days. If the negative item is inaccurate or unverifiable, it may be corrected, updated, or deleted. If verified as accurate, it will remain on your reports.
• Improve Your Credit: Pay all bills on time, reduce credit card balances, and avoid unnecessary credit applications to improve your credit score.

The Bottom Line

While reputable credit repair companies can offer legitimate services, their costs can add up, especially if it takes several months to achieve your goals. Remember, you can perform any action a credit repair organization can do for free.

Before deciding to work with a credit repair company, educate yourself on understanding your credit report and the steps you can take to fix your credit independently.

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