How to evaluate credit repair agencies like a pro
This morning while networking online, I was following up on a forum post by a fellow real estate agent who was inquiring on the subject of credit repair. Anyone that is close to me knows that I am very passionate about this subject. I believe no one should have to go through life with a low credit score.
In 2015 I dedicated 60 days to reading, and learning the ins, and outs of credit reporting, and repair, then from that point I used the knowledge to take action. This has resulted in a 700+ credit score for myself, as well as all my friends that I have helped.
On the forum thread I noticed an individual that runs a so called credit repair agency had posted a reply that was intended to attract potential customers. Before working with anyone to repair credit, always perform your due diligence.
I checked out this agencies website, and the following are red flags that stood out to me. I hope that these will help you evaluate credit repair agencies that you may come across, because no one wants to waste cash.
This agency claimed a 60 point increase for their clients in 6 months
WOW! 60 points! let me get my wallet and throw some cash to this place!
60 points seems like a lot to a person not educated in credit repair, but this can be accomplished with some simple steps. Decreasing balances on credit cards, not creating any new collections, and maintaining or adding positive reporting accounts will typically bring a 40-60 point increase over 90-120 days. This can be done for free.
When evaluating a credit repair agency, ask them the average score increase for clients over a 3-6 month time period if it is not stated on their website.
This agency charged 150 dollars for the first month
It is illegal to charge up front fees for credit repair. The way some companies get around this is to charge for “Credit education” and “document preparation”
Those that practice credit repair know there are 2 types of companies. Those that get results, and those that do not. The ones that get results mostly charge when items are deleted. A company that lacks confidence in their service knows they must capture as much cash as possible up front because customers will be un-satisfied on the back end. So they use trickery with words to capture your dollars. Examples of this would be charging for “document preparation” and “credit education”
We are in the information age. Go out and get your credit education for free. Virtually everyone has access to a computer, once you get you education take action and prepare your documents. If you insist on using an agency find one that takes payment after deletions.
This agency had a 100% money back guarantee
I know you are wondering why I am listing this as a red flag, now let me tell you. There was a long list of conditions for the client to get their money back in the event they were unsatisfied. One of these conditions was:
“You agree to send updated reports from the 3 credit bureaus to us within 5 days of receipt”
This may seem easy enough, but to those that are repairing credit on a daily basis, clients not sending updates in a timely manner is one of the most common occurrences during the process.
So it’s highly likely for you to not forward the updates on time, and once that happens, your money is gone like a cheap magic trick.
Because of the average client only receiving a 60 point boost in 6 months, which can be accomplished with no credit repair services. The lack of confidence in the service, and the tricky word play to collect a lump sum up front, and the money back guarantee that is made weak by having a condition that is the one single thing a client is most likely to do. I think it’s safe to say this company is not looking out for the best interest of the clients, and should be passed up.
Thanks for reading, and I hope these red flags that I pointed out help you evaluate credit repair agencies you are considering giving your hard earned cash.
Share your thoughts in the comment section, and if you have ever has a credit repair company take advantage of you please share for the benefit of everyone.