Credit repair is the process of keeping one`s financial life healthy. In the process you may end up making several common mistakes.
Hiring a credit company that over promise. Credit repair companies know how to repair credit but they do not know or have the capacity to control the specifics. They neither control items on your credit report nor do they control companies that put items on your credit reports. A company cannot therefore promise you that certain item will be deleted or what your score will be when they are through with the service. The Credit Repair Organizations Act prohibits any credit repair company to make false promises or guarantees that would lure a customer into purchasing a service over another. A company should therefore not offer specific time deletion promises or specific promises in a bid to attract more consumers.
Making payments prior to services being rendered. The Credit Repair Organizations Act requires that any credit repair company must deliver the before charging the customer. Upfront Fee Payment where a consumer is required to pay full payment in advance is thus illegal. Consumers are therefore advised to go for companies that offer Monthly Payment Model or Payment After Deletion Model. Payment After Deletion Model involves payment after the actual result have been realized. Therefore, consumer will only pay when there is actual deletion from their credit reports. Monthly Payment Model is where consumer pays for the completed services of the previous month.
Misrepresentation. Most companies misrepresent themselves in order to increase their sales. Salespersons are paid on commission based on their sales. They thus employ all tactics to ensure they make good sales. Some will give fake deadlines while others are actually fake salespersons who do not represent any company and are bound to disappear once they receive payment from consumer. Consumers are therefore advised to make payment to the company after confirming that the company legally exists.
Paying hidden fees. Most companies includes hidden extra fess which should be calculated into consumer`s final cost. These may include postage fees. Many companies may require you email your own letters and thus pay for your own postage. If they are sending letters to each of the creditors, one will end up incurring a high fee for mailing dozens of letters per month. One should not be prompted into paying such mailing cost as it is already factored in the final cost.
Poor tactics. One should be aware of the tactics being used by the credit repair company such as who they will be sending credit letters to. The tactics employed should ensure that they can effectively track where the client is in order to send letters on behalf of the consumer. This may include an expensive software which most companies try to avoid. The consumer should ensure that the company is using certified mailing tactic in order verify that the creditor has received the letter.
As a result of competition from emergence various credit repair companies including scum credit repair companies, a consumer should be careful not to fall into tricks employed by these companies. One should ensure the company you hire is legal and conforms to Credit Repair Organizations Act.