In practice, however, credit repair is much more powerful and complicated.
For starters, the definition of an error on a credit report is much more fluid than one would expect. Essentially, credit reporting errors in the legal sense include anything on your credit reports that cannot be verified as accurate. And as for getting these errors removed, not only are credit bureau disputes not your only option, but they are also not guaranteed to work no matter how egregious an error is.
Unfortunately, many people don't realize this and dive into repairing their credit with a limited knowledge of the credit system. Not surprisingly, they don't get the results they hoped for. To help you avoid committing the same mistake, here are four myths of credit repair to be aware of.
Credit Repair is Easy
This is probably the most common misconception about credit repair. The FTC distills credit repair down to sending a letter to the credit bureaus. Providers of credit repair kits make it sound like you can completely clean up your reports by utilizing their intuitive templates. Producers of credit repair software imply that achieving your credit goals is as easy as entering the correct information in a few forms and printing out and mailing a few letters.
In truth, repairing your own credit is rarely so simple. It's not just about sending letters. It's sending the right letters at the right time. It's about disputing the correct items in the correct order. It's about contacting the correct parties with the correct messaging, and it's about properly following up on letters and managing rejections.
Given the difference between the perception of credit repair and the truth, it's easy to see why so many people give up on cleaning their credit reports before seeing results.
The Credit Bureaus are Anxious to Help
Another fallacy is that the credit bureaus are eager to help you resolve issues with your credit reports. In truth, the opposite is true which is why the credit bureaus have been fined millions of dollars for not providing customer service.The credit bureaus make their money by collecting information about you and then selling it to lenders or right back to you. Communicating with consumers and investigating errors are things that cost them money and reduce profits. As you would expect from any company, this leads to the bureaus refusing to communicate with consumers, rejecting disputes, and generally employing tactics to dissuade people from working to repair their credit.
There is No Risk in Repairing Your Credit
So what's the worst that could happen? If you try to repair your credit and fail, at least you're right back where you started, right? Not necessarily.If you don't know what you are doing, you may find yourself worse off than if you had just left your credit reports alone. Aside from making future credit repair efforts more difficult or time consuming, making errors while attempting to clean up your credit can also result in your credit score getting worse, in renewed collection attempts on unpaid debts, or possibly a lawsuit.
Credit Repair Companies Are A Scam
The truth is that the credit repair industry has seen it's fair share of fraudulent companies. That combined with the messaging that credit repair is easy and the credit bureaus are eager to help you has led to the perception that all credit repair companies are scams. It is unfortunate that this belief exists because it has prevented many people who could use the help of a credit repair experts from taking advantage of the services they have to offer.There are many well established and highly successful credit repair companies operating today that have been providing credit repair services to the public for decades. These companies have employed their experience and knowledge of the laws surrounding the credit reporting systems to help thousands of Americans legally improve their credit scores.
Author:
This article was written by Alex Moore.
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