A credit repair service usually follow a process for cleaning up their clients’ credit reports. The first step they take is to ask their client to provide them a copy of their credit reports from the three major credit bureaus: Equifax, Experian, and Transunion. Consumers can get a free copy of these reports once every 12 months as part of their rights under the Fair Credit Reporting Act.
After the client has provided the credit repair company with these reports, the agency will review and discuss the information on the reports with the client. The credit repair professionals would make recommendations on which items in the report can be disputed.
Following this, the credit repair agency, acting as the authorized representative of the client, would initiate the writing of a dispute letter to the credit bureaus regarding the inaccurate negative items on the latter’s credit reports.
The credit reporting agencies are obligated under the law to investigate disputed items within 30 days. The credit repair company can then demand for the correction or removal of the erroneous information if the credit bureau’s investigation lends support to the falsity of the disputed information. The credit repair company may also have the credit bureaus change any negative information which the latter cannot verify within the given 30 days.
It is to be noted, though, that only inaccurate negative information can actually be removed from the credit report. Any accurate information, positive or negative alike, stays on a credit report for seven years. Only after seven years will the information be taken out of the report.
There are times when the credit repair organizations take further steps to gain proof concerning erroneous items in their clients’ credit reports. Depending on the results of the credit bureaus’ investigations, they might also initiate communication with the clients’ creditors and collection agencies. This is especially true for erroneous reports on collection information, late payments and charge offs.
Credit repair companies do not have magical powers for cleaning up anybody’s credit record. Agencies that claim guaranteed removal of bad credit are most likely scams. Legitimate agencies will always resort to using the consumers’ rights and applicable provisions in existing laws concerning credit repair.
Despite the ready availability of information resources to support consumers who are interested in repairing their credit reputation on their own, credit repair organizations still continue to grow and proliferate. Barring shady organizations and credit repair scams aside, what professional services do legitimate credit repair organizations offer to consumers that account for the continued thrival [...]