There has been plenty of TV and newspaper ads from credit repair companies that claim they can improve your credit report or history and while this may sound enticing, you should be careful of any organisation promising to do such things. You can actually do this yourself at no cost to avoid these companies charging exorbitant fees for these services.
Simply get a free copy of your credit report from all credit reporting bodies once a year. If you notice any inconsistencies, you have a legal right to request for it to be corrected promptly and for free. If you think the correction may be complicated to be requested on your own, you can talk to a financial counselling service or community legal centre to help you with the process. Note that these services are for free. If talking to your credit provider or credit reporting body frustrates you, you can contact their ombudsman service who will investigate your complaint for free.
Many credit repair companies make false claims, aside from the fact that their services may be obtained for free. They claim that they can remove defaults from a credit report but the truth is, nobody can remove correct information from a credit report. By law, those who have defaulted on a loan will have it listed on their credit report for five years and credit repair companies cannot change that, except if it was a mistake or the credit provider did not follow the correct process before reporting the default.
Credit providers are required to send written warnings before listing a default and if they did not, you can get it updated. You can also pay for the default and the credit provider must update your credit report as well. You can have it corrected for free if you do it yourself or seek free services from a financial counselling service or community legal centre. You don’t have to pay credit repair companies to remove negative listings as this is a misrepresentation of the services they actually provide.
Beware of credit repair companies who charge an upfront fee and fees for corrections made. Don’t forget to read the fine print because they don’t really give money-back guarantees. Some even charge exorbitant fees just to terminate the agreement. These companies earn thousands of dollars even if they have not done anything to improve credit reports.
While there is no quick way to fix your credit report, you can do some things to improve your credit health. You can pay off a default to improve your score even if the default will stay on your report for five years. You can also make on-time repayments on other loans or credit cards as these will be recorded in your credit history, showing lenders how you’ve improved in managing your loans.
Avoid a poor credit history by staying on top of your debts. If you find it hard to keep up with your repayments, contact us and we may be able to help you.
If you would like to know more about credit repair and finance, you can click here to know more about Chan & Naylor services. You can leave your details here and we can schedule you for a free consultation. We’ll contact you to explain more.
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