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In light of the Texas woman, owner of Rose Credit Repair, being arrested for faking at least one hundred and thirty-three police reports to erase millions in debt, I will tell you why most credit repair services out there do not work and most are nothing but scams.
If you live in America, at some point in your life, your credit score is something you’ll need to consider if you plan to make any big purchase, like buying a car, a house, a yacht-you never know, it’s good to dream big. But every desire needs time and effort.
While drowning in debt, I have contemplated reaching out to these credit repair businesses. I followed a few of them on social media, read many reviews, and even interacted with a particular “Credit Fix” analyst to see how creditable he was. Of course, he made everything seem so manageable and had a solution for whatever financial difficulty you might be experiencing.
It was a struggle between reality and desperation. I was in conflict with myself. I’ve never got the bravery to take the bait for some valid reason. I’m glad I chose not to.
Table of Contents
How to spot credit repair scams
In desperate times, we tend to be vulnerable. It’s crucial that one doesn’t make any permanent decisions based on temporary feelings, as this can put you in an even worse position. If they sound too good to be true, they probably are.
Here are some of the red flags I’ve decided upon.
Dispute everything. Many of these companies will convince you that every item on your credit report can be disputed. Don’t fall for it that’s just not true.
The Fair Credit Reporting Act grants you the right to dispute certain items on your report, but not all. You have the right to dispute incomplete or inaccurate information. Also, something that cannot be verified. And that’s the loophole used by many to make you believe everything can be disputed.
Make promises. Some credit repair companies are bold enough to guarantee to improve your credit score in an unreasonable short time. They’ll even promise you they can remove some of the negative credit information, even if it’s a legit report.
Pay upfront fees. It’s illegal for credit repair companies to request any upfront payment before they provide service under the Credit Repair Organizations Act. Some of them will charge a large upfront payment to guarantee part of their profit and nail another half of their profit once they’re done with your case.
Also, if you cannot come up with the large payment, they’ll give you the option of installments.
Stop making payments on the debt and pay the creditors instead. You don’t deserve to use credit if you don’t think this is suspicious. Many needy people fall prey to this, simply because they prefer someone else handle it. They get the misguided impression that everything is fine as a result.
You run the danger of them taking your cash and not making good on the loan. Even if it isn’t, you lose the chance to understand the procedure and are likely to make the same error again.
Do It Yourself
Understand credit. You should be familiar with your credit report. Your personal information, your payment history, negative accounts, and your public record are just a few of the divisions that they are divided into. Examine each area in detail, highlighting anything unfamiliar.
Be intentional. Accept full accountability for your spending and saving habits. It is unnecessary to hold the bank responsible for your debt if there are no unusual occurrences on your credit record. You can come up with a plan to pay off this debt as long as you have a steady source of income. To pay off this debt more quickly, if you still have time during the day, consider starting a side business or taking a part-time job elsewhere.
Leave within your means. You’ll be astonished by how many items you can live without if you stick to a strict budget and reduce if necessary. Consider some of these questions: Am I making use of all the phone’s features? Is a monthly fee for such a plan worthwhile? Are my surroundings supportive? If you consistently go out drinking, clubbing, and spending money you don’t have, your environment needs to change.
Start by saying no to the things that you didn’t intend to buy. Whatever is on your grocery shopping list stick with it. So stop looking around and assuming you do, you don’t need it. The goal is to stop spending more than you make.
Automate all processes. You may control your expenses with a variety of financial applications, like Mint and YNAB. Set up a system so that every time you get paid, a particular amount goes directly to your savings after you know what you can afford to live with. If you get paid biweekly, you can split the payment for your monthly bill rather than waiting until the due date.
Do not change your lifestyle. Just because you receive a raise does not indicate that you can afford to update your apartment, car, or clothing. There is no need to change something if you are happy with it. Instead, use that extra money to pay down your debt.
In Conclusion
Is it worthwhile to repair my credit by utilizing a credit repair company? Yes, but only if the bank or agency is well-known as being legitimate and if you already have a strong credit history. Most lenders will be pleased to grant you a personal loan to consolidate all your debts into one because of your good credit history and financial responsibility, most certainly.
If not, you can do it on your own. I genuinely believe that everything they can help with, you can do as well, as long as you have the desire, based on my studies and my experience paying off debt. Everything worthwhile in life takes persistence and time. Avoid becoming too accustomed to debt.
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Gio founded TheGrowthFocusedGuy in January 2020 because he was fed up with debt.
His mission is to document his journey to Financial Independence in order to motivate and inspire others to get out of debt and begin building generational wealth.
