Whether you’re in a rush to repair credit scores that are sabotaging your financing options or are just looking for a ‘clean up’, searching for a credit repair company can be an exhausting process. This is especially true since the industry is saturated with thousands of companies that will take your money and run away or take your money and do no work. It’s hard to find a credit repair company that you can trust.
Your personal credit score is a reflection of how you manage money and financial commitments. It can make or break your chances of being approved for affordable interest rates on loans, your credit can stand in the way of big life goals like purchasing a car or a home. If you don’t know your credit score or are aware of issues with your credit, the most important first step is to purchase a copy of your most accurate scores and reports. The free online scores a really only meant as an educational score, if you want to know the most accurate scores you need to look at your FICO reports.
If you notice negative information or need to consult with a credit repair company, make sure you have an understanding of the different types of credit repair companies and how you can vet them to make sure you’re hiring a trustworthy company.
Types of credit repair companies:
- Affiliates: These credit repair companies outsource every file to credit dispute factories, which are generally on a letter writing campaign with the bureaus hoping the bureaus will not be able to verify information, and therefore having limited success in improving scores. These factories have usually never spoken to the consumer whose credit they are working on, and have full personal information. There is no control over what is being done or the time frame changes occur. The affiliate calling itself a credit repair company may never have met the company that is truly handling the case. Acting as a middle man, they shuffle paperwork from customer to credit factory hoping for success. Consumers who hire this type of repair company are paying, in many cases, a high fee to a middle man who has no hand in the outcome and limited to zero experience with the actual credit repair. The repair factory is being paid a reduced fee and must focus on giving limited service to cover costs which means less incentive to go the extra mile. These affiliates although saving a fortune on the expense of actually owning a business with real employees are taking a fee for bringing a file to the “real” credit clinic or factory that itself can only go so far.
- Generic Credit Repair Companies: These are companies that do their own letter writing dispute process and limited negotiation. At least this type of company has the security of overseeing, controlling, and securing all personal files for clients. The problem is they are limited in their ability to succeed since the process is mostly based on the ability of credit verification. If creditors verify the information is accurate through this generic series of disputes chances of removal become slim and increasing scores impossible. Although they are more secure and have greater access to servicing clients they are limited in their capabilities.
What to look for and ask before you hire:
- Ask about their history and experience in the industry.
- Ask who will be working on your credit, how knowledgeable are they? Are they FICO Certified Credit Experts? Ask to speak with the person who would be assigned to your case.
- Testimonials are great, but look for online reviews. Companies can cherry-pick which testimonials they put up, so online reviews are often the most reliable.
- Talk about their approach. Most companies will not give away ‘trade-secrets’ but they should be able to give an idea of the work they will be doing.
- Make sure you have direct contact information.
Here are a few red flags to help you sort out some of the companies to walk away from:
- They tell you they can help you without a thorough review of your credit and knowledge of your goals.
- They offer to pull your tri-merged credit report without letting you know it will reduce your credit score.
- They ask you to sign any forms before you hire them.
- They are very aggressive and pressure you to start the process.
- They promise or guarantee results.
- They have generic websites and do not publicly list the names of the executives or employees.
- They outsource credit repair services to third parties.
North Shore Advisory has an unique approach: After a client has hired our company, his or her file is assigned to an expert negotiator. Each file gets a full, in-depth credit analysis by the negotiator and a highly skilled credit negotiation team trained in a strategy based on fact finding and intelligence. Since each case is completely different, the strategy must be unique and motivated by what will bring the most success to that particular case. There is no set formula that can be used for all consumers. There will mostly be direct negotiation with creditors and a full investigation of the creditor’s actions taken with negative accounts. The law associated with credit will be just one legal vehicle the negotiator will use to increase scores. Uncovering loopholes and creditor errors throughout our careful process is the foundation of our work. Credit researchers are on hand to supply every tool available so the negotiation team reaches success. As a result, we are able to increase scores in as little as seven to twenty days. In most cases, clients meet their goals and we finish their cases in as soon as 30 days. For the tougher credit problems, we make ten to fifteen attempts to resolve problems through a variety of different approaches, and we are often successful. Writing dispute letters can be part of this intricate credit resolution system, but it is not the basis of our success. In our strategy, it is reinforcement for the majority of the work already processed.
Our negotiation team is on-site and supported by credit researchers along with a full administration staff. The team is made up of direct employees of NSA, and has been handpicked and scrutinized through background checks, strategic analysis tests, and negotiation skills. All NSA employees are treated well and encouraged to grow and blossom as experts in their field. They are rewarded for success, passion, and commitment and given an environment to thrive in. Clients and professionals can be assured that this highly qualified team is full of passion for and commitment to credit education and exceptional service. As the leader of this company, I am proud of the work we do and the twenty years of experience we bring to our clients. I spend most of my waking hours (and quite a few of my sleeping hours) thinking about how to better serve my clients and the professionals who refer them to us. I recently published my second book about credit and scores, Credit Score Power, specifically because so many individuals have requested I deliver a guide they can study to help understand and manage their credit portfolio. I am now also the featured “credit expert” on the Eye on Real Estate radio show and will continue to study and deliver more cutting edge credit knowledge.
Not too long ago, a 680 was an excellent score, but these days 740 has become the number to beat. As most of us know, Fannie Mae insured loans will no longer be available to consumers if they are looking for approval of more than $625,000 in New York City. Anything above this number will be considered a jumbo loan and scores will have to be much higher than what used to be a 660-680. What does this mean for bankers, realtors, and mortgage applicants? It means that we all have to be more aware of our credit and scores, have great reliable sources to help improve scores and educate clients, and work to inform our referral sources and customer base on how to improve their scores in advance of applying for a loan. It seems that credit scores are now more than just a number; they are the key to having the home of your dreams, better rates on monthly mortgage payments, and more opportunities for your family and future.