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Thursday, January 1, 2009

Discover 5 Things To Know Before Hiring A Credit Repair Service

By David Wada

1) The latest figures show that an average American has a credit score of 677. The difference on monthly or yearly payments with a credit score of 677 and 720, for instance, is an average savings of $421 per month or $5,052 per year (i.e. house payments, car payments, credit cards, etc.).

2) A lot of people ask whether credit repair really works. The simple answer to that is, "Yes, absolutely." Millions of items have been removed from credit reports, and tens of thousands get deleted every single day (i.e. late payments, collections, bankruptcies, and foreclosures get deleted). A study released by the U.S. Public Interest Research Group in June 2004 found that 79% of the consumer credit reports surveyed contained some kind of error or mistake.

3) Although there are many credit repair companies out there...use caution and avoid being scammed. The Fair Credit Reporting Act guarantees any customer the credit repair process.

4) The Credit Repair Organizations Act also guarantees that credit repair organizations must give you a copy of the Consumer Credit File Rights Under State and Federal Law before you sign a contract. They also must give you a written contract that spells out your rights and obligations.

5) Read these documents before you sign anything. And before signing, know that a credit repair company cannot:

* Mislead you with false claims about their services

* Take your money unless they have finished the promised services (Not half way; but completely)

* Perform any services, and even after your signature is on a written contract, they must complete a three-day waiting period

During this time, you can cancel the contract without paying any fees.

Be sure the contract specifies:

* The total cost and the payment terms for services

* A detailed description of the services the company will perform

* How many days, hours and minutes to achieve their promised results...okay maybe not that specific, but really drill them on when the services will be completed

* Any guarantees the company offer

* Company name and address

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