As the owner of Credit Repair Resources, I would like to call our credit repair process “Proprietary” or a “Trade Secret,” however, that is just not the case. The fact is that there are no tricks, trade secrets, special-ins with the credit bureaus and/or proprietary practices in credit repair. In fact any organization that makes claims like this are not only acting deceptively, but also violating federal laws that could land them in very hot water. If you hear this from any CRO that you speak with, I would run not walk away from them.
So that begs the question, what does a good credit repair company do that warrants the investment in their service? Well, in fairness of full disclosures and consumer advocacy, I will tell you!
More Than Just Dispute Letters
Critics of credit repair often call it a scam and that there is no way to get accurate verified information off of a credit report. They say consumers can write their own letters to the credit reporting agencies on their own at little or no cost. You know what, they’re right! You heard me correct, they are right!
However, authentic credit restoration is much more than simple dispute letters. In fact the service that my company, Credit Repair Resources, provides is more complex and challenging than I ever dreamed of when I conceived the idea back in 2005. You see, the devil is always in the details. True credit auditing is not just writing dispute letters to the credit reporting agencies over and over hoping to have negative items removed. The reality is that the proof of debt is always the responsibility of the creditor or collector. My company and other legitimate credit restoration companies have intimate knowledge of what a creditor and/or debt collector must provide in order to verify a debt.
A good CRO understands and knows how to identify an erroneous attempt to collect a debt and what a compliant validation looks like. There are literally dozens of consumer laws that creditors and collectors must adhere to. Asking a consumer to understand and apply these statues to their audit would be like asking someone to represent themselves in a DUI case. It can be done, but you are most likely not going to get the most favorable outcome.
Next, most consumers looking to repair their credit are mostly concerned with their credit score. That is typically why they are even considering using a CRO. A common misconception about credit repair is that repair alone will give you the score increase you desire. Well I am sorry to say that this is not true either, it is most definitely a team sport!
Know it and Do It
The reality is that 30% of your score is based on how much you owe versus how much you have available to you in credit. If you do not use revolving credit optimally during the process, CREDIT REPAIR WILL NOT WORK! I am emphatic about this because it is the single biggest reason our clients do not achieve their desired result and I truly want to get everyone to their goal.
I want to give you one tip today that can help a consumer raise their score quickly. Hopefully this will show you what a qualified CRO would know that you may not otherwise. Pay attention here because this can mean the difference between a 5 point increase versus a 50 point increase in the first 45 days.
There is a tactic called the Credit Card Hop, and no it is not a dance! Picture 10 buckets lined up in a row. When your credit is pulled and your scores are generated, you fall into one of these 10 buckets. If you have great credit and no issues, you fall into bucket 8-9 or 10. These buckets give a ton of value to your positive items and less value to negative items. If you have poor credit and have been through an economic event, you fall into bucket 1-2 or 3. Good items are not as helpful and bad items are more detrimental in these buckets. So it’s suffice to say in order to increase your score significantly, you need to move into a higher bucket. So how do you do it? I’ll tell you!
How They Do It
At Credit Repair Resources our goal is to remove and or correct as much as possible in the first audit of our clients file. Additionally we strongly urge our clients to pay down their credit cards, or open 2 new ones if they do not have any in the first month. If we can dramatically shift the shape of the credit report quickly, our clients can hop out of the bucket they are in and move 1, 2 or 3 cards potentially. This is how dramatic score changes can be achieved.
This barely scratches the surface, but I hope that it helps you understand that there is much more to restoring credit than dispute letters and a good provider of services can be an invaluable asset to you if you have been through a lifecycle event that has left your credit damaged.