The Truth of Credit Repair: Is It a Hype or a Help?

Let's face it. If your credit score is less than perfect, it can be hard to get things like credit cards or even an apartment. Credit repair sounds like the easy way out of this problem. But is it the answer? Or is it just a big hype?

The truth about credit repair is not as complicated as you think. Additionally, suppose you've read bad reviews regarding credit repair. In that case, it's important to remember that the quality of your experience is often directly proportional to the quality of the service provider with whom you deal.

These misconceptions may be detrimental if they hinder someone from mending their poor credit and improving their financial position – even more so if that person is you.

To assist, let's examine the truth about credit repair and some of the most prevalent myths.

The truth is that credit repair is concerned with your credit report, not your credit score.

This is a critical aspect of credit repair: the focus is on your credit record, not your credit score. Contrary to popular belief, your report and score are two distinct entities. What happens to your score depends entirely on the measures to correct your report.

The critical thing to note is that credit repair is concerned with ensuring that your report is:

• Completely correct.
• Fair.
• They are entirely supported.

This implies that the credit repair procedure is primarily about combing through your report with a fine-tooth comb for inaccuracies and trying to rectify the problem.

Myth: Your credit score will instantly increase.

Credit repair is not a one-size-fits-all solution for improving your credit score. While this is a tried-and-true method for treating poor credit, it will not immediately repair your score. Typically, individuals unhappy with the outcome or timing of credit repair monitor their scores daily, hoping that they will improve.

When a mistake or error is discovered on your credit report, the next step is to contact a credit reporting service to dispute the incorrect negative item. Once a credit bureau receives a dispute, it has 30 days, and in certain instances, 45 days, to reply. It may eventually repair or delete the wrong entry, but the effect on your credit score will take time to appear.

As a general rule, credit rehabilitation should take about six months to complete. Occasionally, it may take longer, particularly if you contest several items on your credit report.

Other factors contribute to a low credit score that impede your progress and that credit restoration alone cannot address. To raise awareness, the five components of a credit score are as follows:

• History of payments

• Usage.

• Diversification of accounts.

• Direct inquiries.

• Accounts' chronological age.

Myth: Credit Repair Companies are frauds/scam

This is a particularly harmful misconception since the assistance of professional credit repair companies is essential to the process. Naturally, the keyword in that statement is "reputable."

And there is a straightforward method for differentiating credit repair scams from the rest of the industry, mainly comprised of successful and reputable credit repair services.

Consider the following:

• Is this a situation that I am capable of resolving on my own?
• What upfront costs are paid, and are they adequately disclosed at the start of the retainer?
• Has the firm evaluated my case and established its likelihood of success before collecting a fee?
• Is the credit repair business responsible for its credit report, and does this report include the credit repair company's footprint, raising the suspicion of a potential lender?
• Is the firm open about all of your options?
• Does the firm familiar with the Australian credit reporting legislation?
• Does professional indemnity insurance cover the company?
• Is the company interested in the intimate details of my story?
• Are they forthcoming with information regarding the process?
• Will they keep me informed of developments and solicit my assistance?

Answers to these questions will aid in the formulation of your ultimate choice. However, before you arrive, begin by reading evaluations of a trustworthy, results-oriented company like an Australian Credit Lawyer.

Finally, be suspicious of any companies that guarantee results. This is a significant credit repair red flag to watch for, as well as an illegal activity.

Truth: Credit report errors are persistent.

Credit repair may be a lengthy procedure due to the prevalence of credit report errors. Five per cent of Australians had a credit report error that may harm their credit score.

Most customers want and sometimes believe that their credit report is accurate and fair. However, credit reporting companies are not flawless, and mistakes do occur. Specific errors are the creditor's fault.

On a more fundamental level, incorrect information on your credit report may be more difficult for a customer to detect. For instance, a credit report may include duplicate accounts, improper queries, and false accounts. Consumers may not establish credit regardless of what they do without correcting these mistakes or knowing they exist.

A professional credit repair company's expertise may assist in bringing these discrepancies to light since they are trained to search for them. According to reports, the typical client dealt with disputed 28 credit report issues in 2018.

Myth: Credit repair can eliminate exact bad things.

No amount of credit repair can result in the deletion of a legitimate negative entry from your credit report. After all, the purpose of credit repair is to discover and contest inaccuracies or errors in your credit report.

Credit repair is not the answer if the relevant credit bureau substantiates and verifies an item. Some individuals may enter the credit repair procedure assuming that it would heal all ills, including negative things. If negative information is accurate and negatively impacts your score, further measures such as debt validation may be necessary.

You can do more to improve your credit score

Credit restoration is most effective when you take steps to rebuild your credit on your own. Remember the five components of a credit score? As a consumer, each of those factors is somewhat under your control, and establishing a bad credit history may require some new lifestyle choices or spending habits.

For instance:

• Always pay on time. Set alerts on your own devices, mark dates on a kitchen calendar or enrol in autopay if necessary. Additionally, many organizations provide a modest discount for automated bill payments.

• Avoid opening an excessive number of new accounts at once or in a short period. This may have a double-negative effect. Each account you open will trigger a hard inquiry, lowering the average age of your funds in the process.

• Maintain a credit usage rate of about 30%. This is the portion of your credit balance that you have used or owe. Excessive credit use may be detrimental to your credit score and make debt repayment more difficult.

The essential truth to know about credit repair are that it is not a fraud or scam, that it may improve your credit score over time, and that there are numerous programs available to you recover control of your credit condition.

Furthermore, these services and companies may offer further credit analysis, following actions, and credit monitoring to assist you in improving your position.

Tips: Find a reputable credit repair company and go from there. It will still take time, but the results may be worth the wait.

Do it yourself methods vs. professional's help.

How can I improve my credit? Many individuals ask questions when they realize they need to improve something. One method is to execute this step on your own. It is not that hard, but it does require some time and work.

So, here are the fundamental measures to regaining a high credit score:

1. Request to have a copy of your credit report for free.

The first step is to determine your existing score to choose how much you wish to improve it. Every customer has the right to a free yearly credit report from three leading credit reporting companies.

Ensure that you request information from all three ( Experian, Equifax, and Illion). In this manner, you can check whether any of the reports you get have any mistakes.

2. Errors should be eliminated, and disputes should be filed.

All of the material and details in these reports should be carefully examined for any errors that may be contested later. Take your time going through all areas, including your payment history, credit use and duration, as well as the kinds of credit you've previously obtained. Any mistakes may be reported online, via phone, or by mail.

3. Create a good credit history from the ground up.

When your previous accounts have been closed, obtaining a new secured credit card may be possible. Keep in mind that establishing a new secure card will need a deposit equal to the credit limit.

Choose a card issuer that will record your payments to the credit reporting agencies since this information can help you raise your score much quicker.

4. Credit should be used with caution.

Pay attention to your expenditures and always pay off the amount on each credit card you use. It's normal to feel overwhelmed and uncertain where to start. Professional credit repair firms can do this for you, saving you time.

However, bear in mind that, although you have the right to attempt to address your credit problems on your own, this may not always be the best option for you.

After all, you have the right to attempt to repair your car, cut your hair, or solve your plumbing issues, but most individuals would prefer to engage a professional to help with some or all of these chores.

When you work with a respected professional credit repair firm, such as an Australian Credit Lawyer, you get the benefit of years of expertise.

Our experts know how to offer you the most satisfactory outcomes possible without putting you through the agony of trial and error. Professional credit repair services have costs connected with them (like any other professional service). However, the financial advantages of improving your credit often exceed the expense of credit repair many times over.

You may be successful with your own DIY credit repair strategy, but you may also fail or be too busy to complete the process on your own, as so many customers do. It would be best not to underestimate the potentially considerable time investment that the DIY method may entail.

Remember that credit reporting agencies and creditors are not eager to delete anything off your reports and may respond with a firm "no" if you request that an item be removed. 

You risk wasting your time and getting little to no good outcomes if you are not entirely aware of your rights, do not know how to react, or fail to follow up appropriately.

Bottom Line

Having a clear concept about credit repair truth is vital. Do you want to get your debt removed from your credit report? Do you need to have a personal loan for business purposes? Are your outstanding bills piling up because of non-payment or mistakes made in the past? If you answered yes is to any of these questions, it is worth talking to an experienced credit repair lawyer.

A professional credit repair lawyer can help you solve problems that no other avenue available has been able to help you with. 

Let us handle your credit now to focus on your life tomorrow. To begin, please fill out this form to get a Free Credit Assessment!

Follow us on Facebook and Instagram.