Credit repair is possible in a number of cases, but are you aware of the costs involved?
If you suffer from poor credit history, credit repair can be a worthwhile way to improve your credit rating in the event that you’d like to apply for another kind of credit or even a new job in the future. Both having a bad credit history and repairing it comes at a cost. There are a few things you’ll need to consider before you try to tackle your credit repair. As there are a lot of steps involved, seeking professional help could be a valuable idea. Here we discuss your options and explain how much it will cost.
How much will it cost to repair my credit history?
Living with bad credit places a number of restrictions on one’s life, so the number people with bad credit turning to credit repair companies comes as no surprise. If you’ve considered seeking such a service, you may know that these services don’t usually come cheap. The cost of your credit repair will be determined by the credit repair company and will largely depend on the state your file is in. The complexity of your case has an obvious bearing on the cost, as this directly affects the time and effort that the company will have to put in to achieve desired results.
Don’t expect a credit repair company to impart credit counselling, simply because their main aim is to get credit reporting bodies to remove negative marks from your credit file.
What will impact the cost?
When it comes to pricing, credit repair companies function like most other businesses, and charge their clients differently based on individual requirements. Factors that impact costing include the following:
- Defaults. The defaults you have on your credit file have an effect on how much you have to spend. This is because credit repair companies in Australia charge a fee for each mark they work in removing. So, the higher the number of defaults, the higher the cost.
- Successful negotiations. After each successful negotiation that the credit repair company carries out to remove a negative listing, you’ll be charged a fee to ensure the mark is successfully removed.
- Court judgements. Court judgements can have a considerable effect on your ability to get credit, and a credit repair company, for a price, can work in removing the same from your credit file.
- Crossed or linked credit files. In case you’re the victim of crossed or linked credit files because of how certain lenders submit credit data, you can expect a credit repair company to address this aspect, again, for a fee.
Can I repair my own credit file?
Repairing your credit file on your own is possible, but bear in mind that entire process could take weeks, and would involve making scores of phone calls to contact creditors individually. Even if you do choose to take this task upon yourself, getting credit reporting bodies to remove all possible negative information from your credit file would be nothing short of herculean.
Credit repair costs are normally high mainly because fruitful results require reliable professional assistance. These professionals have all the required training when it comes to investigating defaults and contacting creditors, and they know just what it takes to get credit reporting bodies to remove negative marks. Since they’re usually in touch with creditors on a regular basis, they stand a better chance of success.
While opting for professional assistance would cost money, it could be well worth your while because you’ll benefit from the experience of experts in this field. On your own, while you’ll end up saving money in the immediate and near future, the long term story, owing to your bad credit, can be completely different.
What are the benefits of working with a credit repair company?
Choosing a good credit repair company is important, and as long as you’re working with a company you can depend on, you can look forward to the following benefits.
- Professional service. Credit repair companies work at repairing people’s credit files for a living, and they know just what to look for, followed by whom to get in touch with to remove negative marks.
- Worth the cost. While you’ll have to pay some money to a credit repair company, you’ll probably end up paying more as interest in the long term if you get any kind of credit while suffering from poor creditworthiness. This is particularly true for people who have to turn to non-traditional lenders that are typically infamous for charging higher interest.
- No need for collateral. Applying for a loan with bad credit history might require that you provide some kind of collateral, and when a credit repair company is through fixing your credit file, you no longer have to worry about this requirement.
- Access to credit. In some scenarios, people might not qualify for any kind of credit owing to what’s on their credit files, and repairing your credit file in such a situation opens up borrowing doors for you once again.
Repairing your credit file to improve your history is possible. While seeking professional assistance comes at a cost, the results should outweigh the fees. If you do intend to repair your credit history yourself, make sure to research the process thoroughly and prepare yourself for a possibly tumultuous process. Regardless of your choice, make sure to compare your options to determine the best strategy for you.
Frequently asked questions
Who has my credit file?
Credit reporting bodies like Veda, Dunn & Bradstreet, and Experian maintain credit files in Australia. They make them available to creditors upon request.
What does improving my credit rating entail?
The process requires going through your credit file and looking for negative marks. The next step is working on removing these marks.
Can I pay money to a credit reporting body so it removes negative marks?
No, this is not a possibility.