The Dangers of Credit Repair
Do not fall into despair if you have poor credit; there are many options available to those in need of a few extra points. Most of these options are even things that you can do yourself, such as financing a used car, filing a dispute, or paying an old collection. Although the process may feel overwhelming, be wary trusting your financial problems with a credit repair agency.
Often, credit repair agencies perform unnecessary services. In fact, many of these services are quicker and cheaper without the help of a third party. Sometimes, when dealing with an unlicensed or unexperienced company, the attempt to repair a credit score may actually damage it! This is why you must be careful when it comes to credit repair. If you are on the market for some help, take note of the following warning signs:
- Upfront fees — Credit repair agencies are not legally allowed to charge for a service before it has been fully performed. In other words, unless your credit has been successful repaired, no transaction should take place.
- Debt or Cash Only — If the credit repair agency does not offer credit card processing, it could indicate a lack of government approval or a bad financial history. Companies that advertise credit repair should have credit access themselves.
- Online Servicing — Without a physical location, it’s difficult to verify the legitimacy of the agency. Information pertaining to credentials, age, past customers, and other operation-related data is often hard to track down online. Such companies are also notorious for reselling services offered by other established and respected companies.
- Misrepresentation of Fact – If you are directed to do something unethical or illegal, back away from the situation. For instance, if you are advised to apply for an Employer Identification Number in order to start a new credit report, this is bad counselling. With the right dedication and commitment, anyone can repair their credit score, regardless of its initial state, so be careful of misleading promises.
Before rushing to the aid of a credit repair agency, browse our blog for additional tips on how to improve your credit score. Be sure to visit our website to learn more about how we can help improve your credit score through auto financing.