The Case for Hiring a Credit Repair Company

The Case for Hiring a Credit Repair Company

Reading Time: 5 minutes

The good news: We live in an age where you can pretty much do anything with the assistance of software.

 

The bad news: Software has only come so far in replacing the services of professionals.

 

You can purchase software for everything from filing your taxes to improving your credit score, but when it comes to the latter, it is best to entrust your precious credit standing to professionals. The main reason is that credit repair software will require you to do 99% of the work and unless you are a credit wiz, this kind of software will not benefit you much.

 

Here are the reasons why hiring a credit repair attorney is advisable overusing credit repair software.

 

Hiring A Professional Saves Time

Unless you know somehow that improving your credit will be as simple as sending a request for investigation to one of the three credit bureaus then repairing your loan can be a very time-consuming ordeal. In some cases, lawyers will even need to be involved in your case involves taking a creditor to task for false reporting. 

 

When you hire a professional, you will need to be involved. For example, most companies have a consultation and what’s known as an intake session where they gather as much pertinent documentation from the client as they can. Apart from attending these sessions and finding and submitting these documents, though, you will not need to commit very much more time in this endeavor.

 

Here are success stories of people that hired The Phenix Group for their credit repair: 

 

Most credit repair companies work every month in the background. All the client usually has to do is forward correspondences they receive from creditors or bureaus.

 

With software, the individual will need to pore through their own documents so that they can input critical information into the system, which is essentially a glorified spreadsheet. They will also need to read through all correspondence letters and reply to them directly – all very time-consuming activities.

 

Software Cannot Fight For You

First of all, no software no matter how advanced can interact with the credit bureaus or credit issuing entities so forget about disputing frivolous reports or getting things like liens and charge offs stricken form your credit report.

 

There are certain legal time limits that the bureaus have to process requests for investigation and disputes. A professional credit repair company will stay on top of these deadlines and keep track of the process as it develops.

 

They will make sure that the bureaus are doing what they need to do for your best interest and fight against the irritating bureaucracy on your behalf.

 

At best, credit repair software can update you as to the process of disputes, but you will be responsible for filing the conflicts in the first place and deciding what to make of these process reports.

 

A Sounder Investment

There is never any guarantee that you or anyone you hire will be able to improve your credit score, but at least when you hire a professional, there will be some sort of money-back guarantee if they can’t do anything for you.

 

When you “invest” in the credit repair software, there is no money-back guarantee. If you cannot improve your own credit score by using the software you are on the hook for however much you paid for it and for however long you subscribed to the service.

 

The higher-end credit software suites can cost up to $400 too. Most people’s credit can be improved by at least a little within 2 months, which sounds favorable when you consider that most professional credit services charge $30 to $100 a month.

 

A More Comprehensive Approach

At least at the time of this writing, the personal approach cannot be quantified. When you hire a credit repair company, you will have the option of working with a human professional to devise a financial plan that you can follow to better credit.

 

This includes an in-depth analysis of your current debts, finances, your financial goals, and in some cases, one-on-one financial coaching services.

 

No software can provide this thorough analysis and come up with a financial plan specifically suited to your situation. In fact, most credit repair software simply offers dispute letter templates that you can fill out and send to creditors.

 

If you opt for the more expensive software packages, you might be given access to a real live credit expert who can walk you through the process, but at that point, you will be spending as much as you would if you hired an expert only without all the additional services.

 

They Put the Law on Your Side

Fixing credit is not always just a matter of getting negative marks off your record. Sometimes collection agencies have lawyers, and they will not yield to the average citizen that their actions are unlawful or that their grounds for collection are false.

 

Software does not know the law, and they cannot talk to these collection agency lawyers to show them that a mistake has been made or that their actions are illegal. But a high-caliber credit repair professional will know the law and put it to work for you.

 

There are also specific laws that have been enacted such as the Fair Credit Billing Act, the Fair Credit Reporting Act, and the Fair Debt Collections Practices Act to protect consumers and can be leveraged for the benefit of your credit.

 

For example:

 

There are only specific ways a collection agency can go about trying to collect a debt under the FDCPA, and when they violate this act, a professional can leverage the violation as a way to dissolve the deficit for the client.

 

Simply put, no software can do this for you. In the end, hiring credit repair professionals can save you time, money, and make sure that you have a sustainable way to good credit in the future.

 

 

Share this Image On Your Site

How Divorce Impacts Your Credit Score And How You Can Fix It

How Divorce Impacts Your Credit Score And How You Can Fix It

Reading Time: 4 minutes
Whether it’s on friendly terms or not, divorce is stressful, and it can even take a considerable toll on your finances. This means you’ll likely hear phrases such as “100% liable for bills” and “child support payments” as well. In this post, we’ll go over how divorce can impact credit scores and how you can repair your credit.

How Divorce Impacts My Credit Score

Your divorce doesn’t directly impact your credit score or credit results, but the financial issues that come afterward can certainly impact it.

Here are some factors that can cause your credit score to decline:

Your Debt Racked After The Split Up Because Your Ex Was An Authorized User On Your Credit Card

This is quite a common thing with non-friendly divorces. If for instance, your ex is being spiteful, they could try to punish you by using your credit card in order to make large purchases in your name or by accessing your bank accounts.

However, since your former spouse is an authorized user, they can do this legally. What’s more, is that they’re not liable for the payment. To be frank, they can spend as much money as they want to without bearing the consequences for it.

Your Joint Accounts Are Unpaid

Married couples usually have joint accounts. Both and your spouse may share a credit card, mortgage, car loan or other forms of debt. The debt doesn’t go away even after separation because you both are still responsible for paying it off.

Paying For Bills Will Be Tough

It’s no secret that life after divorce is a tough one. During that time, you may experience trouble trying to keep up with all the bills you have stocked up as well as paying for living expenses, especially if your ex was the main breadwinner.

As a result, this damages your credit score if there are any late or missed payments. Because your credit history is the most important factor of your credit score, it would be wise of you to make the payments on time, every time.

Using Your Credit Card To Pay For Costs

If you’re using your credit cards to substitute as means of income – or lack thereof – you could likely end up with a lower credit score. You must ensure that your credit utilization ratio is less than 30%.

With that in mind, paying for legal expenses with your credit card could also affect your credit score. Although every divorce comes with fixed costs, like filing fees, other costs may wildly vary. The fees of the lawyer depend on the condition of your case and the degree to which the issues between you and ex can be contested. For example, if you’re dealing with property or custody disputes, the divorce might cost thousands of dollars and sadly, most people don’t have that kind of cash at hand.

Your Credit Limit Has Decreased

Most of the time, creditors can decide to lower your credit card limits. This may happen once the accounts of you and your former spouse have been separated, especially if the creditor discovers that you’re making much less money now.

Fortunately, there are a number of ways for you to protect your credit score after a divorce.

How to Fix Your Credit Upon Separation

You need to be proactive about your credit score, as it’s not necessarily going to be there during your divorce. This way you can protect your money and make it easier to start your new, independent life.

Here’s what you should do to fix your credit score:

  • Separate all joint accounts: As soon as you’ve confirmed that you’re getting a divorce, either close your joint accounts or switch them to individual accounts immediately.
  • Determine which accounts were shared, according to your credit report: Read each and every line of your credit report for any mishaps and find out which accounts you’re either partially or fully responsible for. It’s actually quite common for spouses to open accounts in their partner’s names.
  • If your spouse has access to your account, remove their authorization: If your spouse does indeed have access to a bank account or credit card that is solely in your name, then remove them immediately to protect your finances.
  • Change your security information: Improve the security of your credit and debit cards by changing their PIN code, as well as the password on sites and apps that link to your bank account. You can also change the security questions so that your spouse doesn’t easily guess them. And if you have moved, change the address so that your credit reports and bank statements are delivered straight to your new location.
  • Change your lifestyle to match your income: Most divorcees – especially those who relied on the income of their spouses – struggle financially to maintain their lifestyles. If this is so, then you may want to cut back on the spending. For instance, you should consider moving into an apartment, get rid of your cable, and also sell your car for a less expensive one. The best way to know what you can and can’t afford is to make a budget. Give greater priority to your most important expenses and try to stay ahead of payments that could directly affect your credit score, like credit cards and loans.
  • Work out an agreement about joint debt payments: Try to work out the specifics of joint debt payments, with or without the help of a divorce decree, and then get it in writing.
  • Keep a check on your ex’s payment due dates on joint accounts: If your former spouse doesn’t pay on time, you can make the minimum payment on your joint account and save your credit score. Later, you can report the non-payments to the courts and get your money back.
  • Boost your income: During your divorce, you should prioritize earning more and spending less. Besides lowering your expenses, you can earn more money by either working overtime or do some freelancing on the side.

 

How Long Does It Take To Repair My Credit Score?

How Long Does It Take To Repair My Credit Score?

Reading Time: 3 minutes

Having good credit is essential if you want to obtain a loan for a house or a new vehicle, open a credit account at a retail store or even get a cell phone contract. Even some employers look at credit scores when determining whether or not to hire an applicant.

 

According to Experian, it’s estimated that 30% of Americans have poor credit, bad credit, or no credit at all. When speaking of credit scores, most reporting agencies use a model that scales credit from 300 to 850, and the cutoff for what’s considered to be bad credit is anything below 499.

 

Most people need credit at some point in their lives, so it’s essential that you keep your credit score above 661 if you want the benefits of being able to get a loan or open a credit account.

 

In this article, we’re going to look at what causes your credit score to go down and how to fix it.

 

What Determines A Credit Score

It’s easy to fall into bad habits and find yourself behind when trying to keep up with your credit score. So, how does one get bad credit? Well, let’s take a look at the factors that go into determining your score.

 

  • Late Payments — 35% of your credit score is determined by your payment history. In fact, it’s the most important factor in determining your credit score. If you’re consistently late with payments, your credit score will remain in the ‘bad’ range. Also, note that bankruptcies and charge-offs fall under this category too.
  • Amount Owed — This represents 30% of your credit score and it includes the amounts you owe on each individual account as well as the total amount you owe in relation to the amount of credit you have.
  • Credit History — 15% of your credit score is your credit history or how long your accounts have been open and active.
  • New Credit — 10% of your score is determined by any new accounts that have been opened and the number of inquiries that have been made to your credit history.
  • Types Of Credit — 10% of your score is made up of the varying types of credit you carry; it looks better on your report to have a few credit cards, an installment loan and a mortgage rather than having all of your credit tied up in credit cards.

How To Fix A Poor Credit Score

Now that we know what goes into your credit score, we can look at how to restore your credit.

 

The first thing to do is to get hold of your credit report and monitor it. You can do this if you have a smartphone by downloading an app that lets you view and track your credit. Most of these apps will even alert you any time you have a change in your score so it’s a good idea to start there because you can’t know where to go if you don’t know where you stand.

 

Once you’ve seen your credit score and determined it’s in need of fixing, you can set about doing that.

 

Now that you have your credit report, check it for inaccuracies and dispute anything you see that’s not right. You can dispute these errors you find online, and while there’s no guarantee you’ll be successful, there’s no reason you shouldn’t try.

 

The first step is to get payments up to date and make them on time; this is the most important step you can take and you must be vigilant. Set up autopay or reminders if you’re forgetful, make sure every payment is made on time.

 

The next thing you have to do is to work on getting your debts paid down quickly; that may mean paying more than your monthly payment, but whatever you have to do, pay off your balances as soon as you can, starting first with the accounts with the highest interest.

 

Another thing that can help is getting another credit account. We get it, you’re trying to get out of debt, not go deeper in! But here’s the trick. If you open a new account but don’t carry a balance on it, that increases your credit to debt ratio and will improve your score.

 

How Long Will It Take?

The good news is that bad credit isn’t forever. If you follow the steps outlined and use credit wisely, your credit score will improve. The short answer to how long it takes is: it depends. It depends on how low your score was, to begin with, and what kind of negatives you had. But you can expect the process to take anywhere from six months to a year. The key is to be patient and keep monitoring your score every month to see the progress.