The Hazards of Credit Repair Companies

What credit repair companies claim

Credit repair companies claim they can boost your credit score by removing negative items from your credit report — including accurate items. 

However, there is no legal way to permanently remove accurate information from your credit report. While all negative items automatically fall off after 7 or 10 years, credit repair companies cannot erase truthful information permanently prior to that time.

Credit repair companies often charge substantial upfront or monthly fees for their services. Many operate by submitting large volumes of disputes to the credit bureaus each month. Once the bureaus receive the disputes, they only have 30 days to investigate and respond. If the bureaus fail to meet that deadline, the disputed items must be removed from the consumer’s credit report—even  accurate information.

When removals occur, credit repair companies quickly notify consumers. However, if items are accurate and removed only because the bureaus missed the 30-day deadline, they are typically reinserted into the credit report within two to three months. While credit repair companies consistently report these removals to their customers, they rarely disclose when the same items later reappear. This creates the impression that every removal is permanent, even though many are only temporary.

Credit repair warning signs

• Requests for an upfront payment or ongoing monthly payments.
• Promises to fix your credit by getting negative items off your report.
• Claims of permanently removing accurate information.
• Requests to sign contracts with no end date.

Better ways to dispute real errors with the credit bureaus

• Visit annualcreditreport.com to review your credit report.
• Dispute inaccurate information directly the credit bureaus.
• Learn how to file a dispute from the Consumer Financial Protection Bureau.

Get help from trusted sources: 

• The National Foundation for Credit Counseling 
• Financial Counseling Association of America
• National Association of Consumer Bankruptcy Attorneys