How does a credit repair company work: Are generic dispute letters used

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Consumers may question how does a credit repair company work. It’s simple, a credit repair company should be able to explain in detail what they can and can’t do and should be able to outline their services so you fully understand what you’re getting upfront. Sending out a ton of generic letters may not get you results.

I had a question that I wanted to ask you. I was going thru a credit repair company for about 7 months. I cancelled service with them because it didn’t seem as though they were really doing much and the letters they were sending were all so generic.

So needless to say after so many months of the credit bureaus getting these same disputes, they basically are saying it’s nothing they can do. They won’t even take them seriously anymore. Everything just comes back saying it’s been verified. At this point, do you think it’s even worth still trying to dispute or go straight to pay for delete?

I requested validation on my accounts but never received any. I even submitted a complaint with CFPB against all the credit bureaus because of the validation issue and still received the same answer stating account was mine. No real answer or proof was given of why information wasn’t sent as requested.

The credit cards are what I’m most concerned about because they are severely affecting my utilization even though they’re in collections or charged off. I am considering enrolling in your program but I wanted to get a little insight from you first to see if you think there’s anything I can do at this point.

First, we don’t have a credit repair program. The information offered on the site “rebuildcreditscores.com” is FREE. We provide insight and education on how credit works and ways to improve credit scores. We firmly believe anyone can rebuild their credit history.

I understand people don’t always think they have enough knowledge or the time commitment to fix their own credit, but it is possible. Unless you hire a credit repair attorney, most credit repair companies aren’t doing anything you can’t do for yourself.

How does a credit repair company work

While the method of credit repair may differ from one credit repair company to the next, using a credit repair company involves generic credit dispute letters. The problem with many credit repair company tactics is that accounts are not disputed based on some type of unique credit error or inaccuracy. Generic dispute letters are often sent in massive amounts to the credit bureaus.

Disputes should be based on some type of error within the negative listing. Plus, having documented proof to back-up disputes helps tremendously in getting those errors corrected or the getting the negative tradeline deleted.

It takes time to review a credit report for errors and inaccuracies. But the time it takes can be worth the effort.

Once a credit repair company spots an error, they should request from you any supporting documentation you might have or need. For example, if there’s a bill on your credit report that your husband or wife was actually responsible for under your divorce decree, you can use that document to prove it shouldn’t be impacting you.

Unfortunately, you fell into the credit repair trap where some companies send tons of generic letters for their clients, without any back-up proof, hoping the original creditors will not respond within 30-days and the account will be deleted.

Credit bureaus get thousands of letters every day. Most credit repair companies use scanning software which identifies template complaints and send a generic response letter without much human intervention.

How to choose a credit repair company

The best way to choose a credit repair company is to ask a few questions during your search. Here is what you should look for:

  • The first action a good credit repair company will do is pull your credit reports from each of the three major credit bureaus to pinpoint your unique credit issues.
  • Why you need a credit report from all three credit bureaus? Because each credit bureau has its own “data furnishers” (aka lenders, credit card companies, debt collectors, etc.) who report your credit information to them. Each of your creditors don’t necessarily report to all three credit bureaus. And, there may be errors that appear on one of your credit reports, but don’t appear on the others.
  • Because 79% of consumers who disputed credit report errors were successful in removing them, you want a credit repair company to offer a unique solution to each of your problem accounts. A generic letter will not work for every credit issue.
  • Once those errors have been identified, you’ll then give a credit repair company any supporting documentation.

Steps to repair your own credit

Be your own credit repair company. Learn about credit to insure you and your family are educated about how credit works.

It’s best to write your own dispute letter in your own words. This increases the likelihood that a live person will actually investigate your dispute. Generic letters can give you an idea of what to say but always put it in your own words.

All I can do is suggest you thoroughly read improve credit scores for 2018. Pay attention to No. 10 – “Strategies to get rid of negative credit items.”

You are on the right track in pursuing “pay for deletes.” At the end of the day, if the account is truly yours and it’s reporting correctly, there really isn’t much you can do except wait out the 7.5 year credit reporting time period; pay for delete; or settle the account.

Even if you don’t get the creditor or collection agency to agree to a pay for delete, paying the debt will stop the high utilization from negatively impacting your credit scores.

Be sure to look at every charge-off account and examine the following:

  • If it has been sold or transferred to a collection agency the original creditor’s reported balance should be $0.
  • If the original creditor has not sold or transferred the account to a collection agency try to work out an agreement to pay for delete.
  • If you can’t get an agreement to delete, paying the debt will still help your scores because the amount owed will be $0. Plus, you can always go back and retry for a deletion with the company. Sometimes it takes multiple efforts to get someone in upper management to agree to a deletion.
  • Never attempt to work with a customer representative when attempting a pay for delete agreement. You must research the company, find a street address or email address for someone in upper management, a VP or CEO to work with.

Another tip is if you request validation and the collection agency fails to respond, that’s the complaint you make with the CFPB. A complaint to the CFPB about credit bureaus reporting unvalidated accounts typically goes nowhere. But complaints to the CFPB about a debt collector failing to follow the Fair Credit Debt Collection Practices Act by not providing validation has more traction.

But for sure to read the improve credit scores for 2018, it has some helpful tips that you can implement on your own to get your credit back on track.

 

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