Should You Use a Credit Repair Company?

You just looked at your credit bureau report again and your anxiety skyrockets. You ask yourself, “What am I going to do to fix this? Should I use a credit repair company?”
 
You have probably seen the ads that guarantee the removal of negative information on your credit bureau report like bankruptcies, charge offs, and collections.  You think to yourself “I should just let them handle it for me, they guarantee they can remove all the negative information on my credit bureau report”.  It sounds great, doesn't it?  However, the truth of the matter is that no company can remove accurate and timely negative information from your credit bureau report.  The only person that can remove accurate and timely negative information from your credit bureau report is good old father time. 
 
Most negative information, as long as it is accurate, will remain on your credit bureau report for seven years from the date it occurred. Bankruptcies will remain on your credit bureau report for 10 years.  So, you ask yourself, “how can these companies say they can do this if they really can’t?” The simple answer is that companies sometimes lie.  Yes, I know, shocking.  Let’s take a look at RMCN Credit Services, one of the largest credit repair companies in the nation.  In 2011 The Federal Trade Commission sued RMCN alleging that they sent “deceptive dispute letters to credit bureaus even after the company received detailed billing histories or signed contracts from creditors proving the credit reports were accurate”. RMCN also allegedly “falsely told consumers that federal law allowed it to dispute accurate credit report information”. [1]  RMCN settled with the government and a $2.35 million civil penalty was imposed.
 
A reputable company will never guarantee removal of negative information that is both timely and accurate.  Even if you were lucky enough to find a reputable credit repair company, there isn't anything they can do to remove inaccurate or untimely information that you cannot do for yourself, and at a much lower cost.
 
10 Steps to Dispute Inaccurate Information on Your Credit Bureau Report:
 

1. Obtain a copy of your credit report from all three major credit reporting agencies.  You can obtain a free copy from all three major credit reporting agencies once a year by going to https://www.annualcreditreport.com/index.action 
2. Make at least two copies of each credit bureau report.  Keep the originals in a safe place.
3. Go through each credit bureau report and highlight every account that you believe contains inaccurate information and make notes as to why.  You will use this information in your letters.
4. Write a letter to each credit reporting agency that has reported inaccurate information.  State in detail the specific account that you are disputing and why you are disputing the accuracy.
5. Attach all relevant information that shows the inaccuracy of the account that you are disputing.  You can also attach a copy of your credit bureau report with the disputed account highlighted and reference that in your letter.
6. Send each letter with attachments by certified mail return receipt requested so that you have an accurate record of when the credit bureau agency received your letter.  You can also go to each agency’s website and use their link to initiate a dispute.
7. The credit bureau agency has 30 days to investigate the disputed account.
8. The credit bureau agency will also contact the creditor that reported the disputed information.
9. If the creditor determines that the disputed information is inaccurate, they must notify the credit bureau agencies so they can remove or correct the inaccurate information.
10. After their investigation is complete, the credit reporting agency must give you written notice of the results. If the results are not in your favor, you may wish to place a statement on your credit bureau report which allows anyone who sees your credit bureau report in the future to read your explanation about the disputed account.

 
When it comes to removing inaccurate or untimely information from your credit bureau report, it really comes down to patience and persistence. You must be willing to take the time to thoroughly read your credit bureau reports and if you find inaccurate or untimely information, write the credit reporting agencies. Your letter does not need to be poetic. Just a concise statement of the facts as you see them. 
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As you can see, none of this is rocket science, it just takes a willingness to put in a couple of hours of your free time. You will find it is well worth it. Paying someone for what is essentially a letter writing campaign, that does not require an attorney, in my opinion is not money well spent.  Please take a moment to comment on this article and share it with someone.


[1] FTC News Release June 18, 2014.  Court Order Bars Credit Repair Company from Misleading Credit Bureaus, Charging Consumers Up-Front Fees for Its Services.  ftc.gov/news-events/press-releases/2014/06/court-order-bars-credit-repair-company-misleading-credit-bureaus.