When looking at Google, one of the highest ranked search terms that put this website in the rankings was Credit Repair FAQ. That tells me there are a lot of unanswered questions out there. I
wanted to give pause to that fact and come up with a good guide that will hopefully answer as many of these questions as possible. I will also include some FAQs about credit itself as well. It’s time to peel back the curtains and take a peek inside the credit repair industry. If your question was not covered here, feel free to leave your question in the comments, or contact me from my website, and I will gladly answer any question you have.
General Credit Repair FAQ
- I hear credit repair is nothing but an elaborate scam, is this true? – In general credit repair is not a scam. Unfortunately, in every industry there are scam artists. But I can tell you in general, for every scam artist, there are 100 good and reputable credit repair companies out there that are owned and operated by great people that truly care about their clients.
- How do I know I am dealing with a legitimate company, and not a scam artist? – This specific question I address in another article, because I felt consumers needed to know all the signs and show what a reputable company looks like vs a scammer. Click this link to read that article.
- Can credit repair eliminate my debts? – Maybe. Unless the credit repair company also holds a debt settlement license, or the debts are gaveled away in the courtroom, a credit repair company can not negotiate settlements or eliminate your debt.
- Why do credit repair company charge for their services differently? – Some credit repair companies charge monthly (for prior month’s work) and others do Pay for Delete. This is because of several factors, I did an extensive write-up on the topic. Click here to read the article.
- What Do Credit Repair Companies Do? – Depending on the company you are dealing with will be what services they offer. In general, for credit repair we analyze your credit reports. Based on the analysis, we prepare disputes and challenges on your behalf and mail them to the credit bureaus, data furnishers (creditors, collectors, etc) in hopes of deletion or correction. Then every 30-45 days we look at the reports again to see changes and prepare another round of disputes or challenges based on your credit reports. We also encourage the use of credit building products to help with your score. We also educate you on how the credit system works, and how to manage your credit going forward so you have the best credit you can have.
- Does Credit Repair Get ALL Negative Items Off My Credit Report? – It is possible, but HIGHLY UNLIKELY a credit repair company can get 100% of everything off. However, regardless of having a couple negative items leftover, between the deletions we do get, and the credit building process, you will likely finish your journey better than when you started. BE CAREFUL of those who paint you the prettiest picture of 100% deletion, that’s one of the signs of a scammer.
- What Are Credit Sweeps? – Credit Sweeps are HIGHLY ILLEGAL and you should AVOID/report anyone who is advertising such. Credit Sweeps involve one of these methods. The first is having you obtain a police report, or getting an ID theft affidavit, and send to the credit bureaus disputing all negative items, claiming you are a victim of ID theft. The other method is to get you a fake Social Security number or ITIN number to build a fictitious credit profile. Both of these practices can land both the individual or you in jail.
- Will My Credit Score Go Up? If So, How Much? – As negative items are removed, it is assumed that your credit score can go up. However, there can be instances where the score can drop temporarily. For example, if you had a really old account that gets deleted. Since credit age is one of the factors that make up a credit score, the above scenario would decrease your credit profile’s age and could drop the score slightly for a short period. There are really no guarantees of how the credit scoring models will react to a change on your credit profile. If anyone says they will increase your scores 100 points, I would steer clear of them.
- Can Negative Items Come Back After Being Deleted? – Yes. It is possible for a negative item to come back. There are 2 reasons that can happen. The first applies to debt collections. Let’s say we get a collection off your report, that collection agency could return it to the original creditor, then the original creditor hires a different collection company to try to collect the debt. The second reason is because the data furnisher sends the credit bureaus new information that allows the account to be re-inserted on the credit report. The credit bureaus are required by law to send you a re-insertion notice within 5 days of the re-insertion. If they don’t, you potentially have a lawsuit.
- What Is A 609 Dispute? Are They Effective? – 609 disputes are largely found in self-help credit repair books, and online in templates. Some untrained credit repair “professionals” employ this tactic as well. A 609 dispute is a letter that demands the credit bureaus supply originating documents (contracts, etc.) or delete the item, based on a flawed interpretation of the FCRA (Fair Credit Reporting Act). Although a deletion is possible using a 609 dispute, it is highly unlikely. 609 disputes tend to be non-factual. Section 609 of the FCRA in laymen’s terms only entitles the consumer to a full disclosure credit report. This dispute method is largely ineffective. I dive deeper into this topic. Click here to read why 609 disputes don’t work.
- Can I Fix My Own Credit? – Of course you can! You can also change the oil in your car. Think of credit repair companies as “Jiffy Lube”. Of course, start with good habits such as paying your bills on time, not charging up your credit cards above 30% of your credit limit, not applying for credit unless you need it, don’t close your current accounts you’ve had open for a long time, etc. I will caution you on one point to consider. Credit repair professional in large have trained eyes and can easily identify disputable items on a credit report, we also know the laws (we are not attorneys however.), and can prepare effective disputes that also can hold up in court if need be. The internet is filled with resources to help you fix your credit, but I must caution, the majority of information you find on the internet is misleading. If the resource claims to have the “silver bullet” method or letter, such as 609 disputing, I would go to the next search result. My company takes this very seriously and will be offering classes, and an eBook soon.
- How Long Does Credit Repair Take? – This all depends on your credit file, and how the credit bureaus and creditors react to the dispute process. Typically, most people can expect 6 months or less, but can be as long as 1 year for more complex credit files.
General Credit FAQ
The world of credit is very confusing. To make matters worse there is some misinformation out there. Before I proceed with this part of our guide, I would be doing a disservice if I didn’t refer you to this YouTube Channel. It is though a partner company, Tradeline Supply Co. This is a great resource for general knowledge regarding credit. Hopefully this guide will be helpful, of course you are welcome to reach out, I’ll be glad to answer your questions!
- Credit Karma Said My Score Was 620, I Got Denied Because The Loan Officer Said My Score Was 580? – This is because there are a plethora of credit scores. Everyone has heard of FICO. Credit Karma and many other credit monitoring services use Vantage which scores credit differently. To further complicate things, there are several versions of FICO scores, and 3 versions of Vantage Scores. Even lenders have their own proprietary scoring models.
- Am I Hurting My Credit By Checking It? – No, checking your credit does a “soft” inquiry which has no effect on your credit score.
- What Is The Difference Between A Soft And A Hard Inquiry? – A “hard” inquiry comes when you apply for credit. Those do affect your score slightly, and report on your credit for 2 years. A “soft” inquiry comes when you check your credit, or when lenders check your credit for promotional reasons to send you offers.
- How Do I Maintain A Credit Card Properly? The main secret to keeping credit cards optimal for credit reports is to keep less than a 30% of the card’s credit limit charged at any given time, 10% is even better! Always pay on time, payment history is a HUGE factor in a credit score.
- Why Did My Score Drop When I Closed My Credit Card Account? – Account age is a factor in your credit score. Even if you were never late and kept a good balance, closing down a credit card can reduce your credit profile’s age thus causing your score to drop. This should rebound as other accounts age.
- I Bought A New Car, Now I Have 20 Inquiries On My Credit, Why? – Anytime you fill out a credit application at a sales center or dealership, they run your credit with their lending partners to get you approved, or approved with the terms you want. Each lender they try causes an inquiry to show up. To avoid this, you can go directly to your lender of choice and apply for financing.
Final Thoughts…
I know these lists do not cover every question about credit repair or credit in general, but it should catch a majority of them. In credit repair, it is important to do your homework to select who you feel most comfortable with. If you have found this guide to be somewhat helpful, and you are seeking credit repair services, feel free to schedule a free consultation with us. We want to help you achieve your credit goals!
