However, there are also a lot of scams that you should pay attention to. A better route might be to simply take steps to repair your credit on your own. Consumers can repair their credit for free on their own (read on to learn how to do this). However, if you think you're not disciplined enough to do the repair work yourself, you can consider working with a reputable credit counseling firm, many of which are non-profit organizations.
According to the Consumer Financial Protection Office (CFPB), the following are signs of credit repair scams. These services often include assistance in challenging errors in credit reports, negotiating with creditors and collection agencies, and providing educational resources and tools to help consumers improve their credit scores. To find a reliable credit counseling company, check with the United States Financial Counseling Association or the National Foundation for Credit Counseling. These services can provide you with a nine-digit number that looks like a Social Security number called a CPN, credit profile number, or credit privacy number.
If you want a hand, the personal financial manager at your local credit union, university, or military may be able to recommend a nonprofit credit counseling program that can help. Business credit agencies often send you warning notifications when a derogatory mark is going to be added to your credit report. The goal of these companies is to strengthen their credit by challenging the outdated or incorrect information in their credit reports, following up on the results and monitoring to ensure that errors do not recur. There are legitimate companies that offer credit repair services, but the industry is also known for its scams, so it's important to research any company you're considering hiring.
Send the letter to your creditor and to the credit bureaus, as some creditors don't report information to the credit bureaus. The CROA is a federal law that aims to protect consumers against scams by establishing guidelines for what credit repair services can and cannot do. Unlike a personal credit report, if you reach an agreement with a creditor to settle a debt for less than the outstanding balance, you can have it removed from your business credit report. You also have the right to terminate your contract with a credit repair company within three business days of signing, for any reason and at no cost.
As with personal credit, you can pay a credit repair company to settle your business credit, or you can do it yourself. It's worth noting that even the most reputable and reliable credit repair services can't legally do anything that you can't do yourself. This can help improve credit ratings and make it easier to obtain loans or credit cards on favorable terms.