What Do Credit Repair Companies Do?

Having a high credit score is important because it has a big impact on people’s ability to obtain credit and other financial opportunities. The ability to get a loan, a good interest rate, cheap insurance premiums, or even a job, may be impacted by the credit reports.

If you have a low FICO score and your credit reports are not so great, credit restoration may be a good solution. You can repair your credit score by paying a third party, also referred to as a credit repair firm or a credit services company to fix your score. You can draw up a contract with them and these companies will then assist you in raising your credit scores. The legitimacy of these credit repair services is acknowledged by the majority of states and the federal government.

There are companies who advertise that they can help customers repair their credit by getting inaccurate and negative information taken out of their reports.

All About The Credit Repair Organizations Act

The federal Credit Repair Organizations Act specifies in great detail what a credit repair business is and how it must operate. The specific details of what credit repair firms can and cannot do to comply with federal laws are laid forth in the 1996-passed Credit Repair Organizations Act (CROA).

How Do Repair Companies Assist?


The businesses that “provided” information about you to credit bureaus as well as credit repair companies are dealt with directly by these repair businesses. These information suppliers are typically debt collectors or companies in the banking and credit card sectors.

The aim is to get the record of the consumer either removed or modified by the credit reporting companies and data providers. Customers of restoration services may be contacted by phone, email, or ordinary mail.

Even though it can seem straightforward to submit letters to the bureaus, this is the approach that the majority of restoration businesses take and thus the proces might take time. Some repair companies employ the tactic known as “jamming,” which comprises bombarding bureaus and the businesses that provide them with information with numerous letters that are generally irrelevant.

Repair businesses operate on the premise that if they send enough dispute letters disputing the same item repeatedly, one of the bureaus, lenders, or debt collectors will miss the Fair Credit Reporting Act’s deadline, leading to the dispute being dismissed and the account being deleted.

How Much Does Fixing Your Credit Cost?

There are two pricing models that every Credit Repair Company in Philadelphia generally uses. The first option is a standard monthly subscription service, where the repair business bills you at the end of the month for the job they completed the previous month. Due to the subscription fee model, the repair company has an economic incentive to retain you as a client for as long as possible.

The second kind of restoration payment is known as Pay per delete. When you use this service, you only have to pay when the negative items on your report are actually deleted. Pay-per-delete business models are intended to maintain restoration companies in conformity with the CROA by postponing customer payments until deletions have really taken place. This will please customers by only charging them for actual deletions.

Does It Actually Work?


Although some firms claim to have deleted millions of negative entries, there are no reliable statistics on the success rate of repair services. Additionally, no data is available on the cost incurred by consumers seeking repair, the proportion of disputes that end in deletion, or the effect of repair on customers’ ratings. Remember that after seven to ten years, factually incorrect negative material will be removed from your reports on its own.

How Long Does It Take To Accomplish This?

The first step in fixing your credit is to get your reports and look them over to make sure they are correct. As per law, each of the three major national bureaus must give you one free report every twelve months.

The bureau is required by law to look into and confirm the authenticity of the disputed information within thirty days of receiving your claim. The bureau will often contact the information provider first and ask for more information. You have five business days to get the results of the investigation from the reporting agency.

Note that the information contained in your reports can vary between bureaus. This is because some of the creditors may report to only one of the above-mentioned bureaus.

The FTC advocates contacting the bureau or agencies first. Explain the information you are challenging and include a copy of any supporting papers. You may also contact individual creditors to dispute information they provided to the bureau. The law mandates that the bureau evaluate your claim within thirty days, unless it deems it to be without merit.

When the investigation is complete, the bureau must provide you with written results. If the bureau rules in your favor, the original creditor must tell the bureaus to whom it sent the inaccurate information so that they can repair your file. You have the right to provide a written explanation that will be added to your file, even if the judgement goes against you. The majority of this process may be accomplished online, and the websites of the three major agencies provide instructions and the necessary forms.


A bad score will affect your life adversely in numerous ways and will hinder you financially. Thus, it is advised to reach out to an agency and get all the false information removed. Legitimate repair firms can help delete false information from your reports so that it does not negatively impact your score. However, there is nothing they can do for you that you cannot do for yourself if you are ready to invest the time as well as the effort needed to accomplish this.