Life with a bad credit file can be nearly impossible. Not surprisingly many in this position look to credit repair services, but how much do they cost?
The cost of credit repair will generally be determined by what has to be done to repair your credit. Many factors will affect credit repair cost including the complexity of the credit situation of the individual involved, and the amount of work that needs to be done to fix it.
Such credit repair is usually done by a business called a credit rating repair agency. These agencies don’t provide credit counselling, instead they actually try to get negative items removed from a credit file. It is possible to get these items removed, but a legitimate credit repair will cost quite a bit.
The major factor affecting credit repair cost will be the number of defaults or items on a persons credit file. Not surprisingly the more defaults in a file the higher the cost of credit repair. A person with quite a few defaults in their file could end up paying quite a bit for credit repair.
In some cases the credit rating repair agency will have to negotiate with the creditor for removal of the default. The reason for the high credit repair cost is that the agency will have to negotiate with the creditor.
Then, if the negotiations are successful, you’ll also have to pay to have the incorrect mark removed.
Cost of credit repair
Credit repair is just like anything else in this world, a person gets what they pay for. If an individual really wants to get their credit cleaned up and negative items removed they will have to be ready to pay several hundred dollars or more.
Those who aren’t willing to incur a fairly high credit repair cost will not be able to get their credit fixed. The only way to fix a credit report is for somebody to investigate every item listed on it and determine what can be removed.
Many credit reports could contain false, inaccurate and sometimes fraudulent items. Unfortunately credit reporting agencies will not remove these items unless they are pointed out to them.
Contrary to popular belief credit agencies are under no obligation to remove these items unless a person questions them. To get negative items taken off for good, a person will have to present evidence that the item is false or inaccurate.
The average person simply doesn’t have the money or resources to investigate all of the items on their credit report for accuracy. A credit reporting agency does have the resources but a legitimate credit reporting agency will charge for the service.
It will take several hours or days for a professional to investigate defaults and other items on a credit report, contact the creditors involved and get inaccurate data removed.
There is no such thing as free or instant credit repair. Credit repair can be done fairly quickly, but it will cost an individual several hundred dollars.
Repairing your own credit file
A person can repair their own credit file but they would probably need to do several weeks worth of research, and make dozens of phone calls to track down the creditors and contact them. Even then it could be impossible for a private individual to get a credit agency to remove all negative information from a file.
Credit repair costs are fairly high because real credit repair requires the services of a professional. Such a professional knows how to investigate defaults and more importantly how to contact a creditor and get a default or other negative information removed. They will also have working relationships with the creditors and might be able to get further than you would have anyway.
Professional credit repair can cost quite a bit but it is worth it because the experts can actually get credit files fixed for good.
In many cases a professional can get a credit file cleaned up with a few phone calls in a few hours. Even though the services of such a professional can cost several hundred dollars they will generally be worth it. Especially if you know that a large amount of credit will be needed in the future.
Is credit repair worth it?
Are credit repair costs worth the money spent on them? The answer is yes because a person with a poor credit file can pay several hundred or several thousand dollars a year in additional interest on credit cards, mortgages, loans and other forms of credit.
A person or a business with a bad credit file owes it to themselves to investigate credit repair costs. A bad credit file can have other costs that a person may not realise until it is too late.
In many cases, someone with bad credit will have to pay additional fees, as well as high interest on credit. Individuals with negative information on their credit files may have to turn non-traditional lenders that charge a lot more interest.
A person with a bad credit file could also be required to put up additional collateral for a loan. This can add to costs and slow the loan process.
In the worst case scenario, people and businesses with bad credit files may not be able to get the credit they need. Not paying credit repair costs can leave a person without such essentials of modern life as credit cards, mortgages, car loans and business loans. A person who is unwilling to pay may not be able to buy a house, car, or operate a business.
People may not like paying the costs involved with fixing credit, but spending a few hundred dollars on credit repair can make life a lot easier in the long run.