Should you hire a credit repair company?

Hiring a Credit Repair Company

Here are some things to know about credit repair companies. By law (see The Credit Repair Organizations Act), credit repair services must give you a copy of the "Consumer Credit File Rights Under State and Federal Law" before you sign a contract to repair credit. Credit repair companies also must give you a written contract that spells out your rights and obligations. Read these documents before signing the contract. The law contains specific protections for you. For example, a credit repair company cannot: make false claims about their services; charge you until they have completed the promised services; or perform any services until they have your signature on a written contract and have completed a three-day waiting period. During this time, you can cancel the contract without paying any fees. Your contract must specify: the payment terms for services, including their total cost; a detailed description of the services to be performed; how long it will take to achieve the results; any guarantees they offer; and the company's name and business address.
Here are more opinions and answers from other FAQ Farmers:

• Although there are a lot of scam artists out there peddling credit repair services, some are legit. Of course using a credit repair company is totally up to you. Just keep in mind that the credit repair company shouldn't charge you any money up front until they have performed the services that they agreed to perform - it's the law. Also, you must be fully involved in the credit repair process; no credit doctor or company can successfully restore your credit history without your participation. You should also read and completely understand your contract and be able to get out of it at anytime you choose to without penalty or obligation. Last but not least, you should understand that there is nothing a credit repair company can do that you can't do for yourself.

• A credit repair company can do nothing an individual can do. So the only reason for one to use a credit repair company would be for help. If the individual can't or doesn't want to learn the credit system.

Also consider finding a consultant that is a member of a trade association that is regulated by the credit service industry. Credit Consultants Association is such an organization.