If you’re struggling with bad credit, there's a chance it's not your fault: Almost half (44%) of people who reviewed their credit reports found mistakes, according to a Consumer Reports study, and nearly a third of them found errors that could damage their credit score.
Credit repair companies will contact the three main credit bureaus on your behalf to remove inaccurate or outdated negative marks from your credit reports. They can also work with banks, debt collectors and other financial institutions.
While you can do much of this on your own, it's time-consuming and sometimes daunting. For some people, having a professional go to bat for them is worth the expense —especially when the result is a major increase in their credit score.
Find the right credit repair company
How do credit repair companies work?
Credit repair services will reach out to the three credit bureaus to remove errors, including:
- Misspelled names, wrong addresses or incorrect birth dates
- Individual items listed multiple times
- Accounts that have been paid off but appear outstanding
- Debts incorrectly reported as being in collections.
- Information from someone with a similar name or Social Security number
- Fraudulent accounts listed as a result of identity theft
Whether a credit repair service is worthwhile is up to you. Depending on the situation, they can file challenges with the credit bureaus and send dispute letters directly to your creditors.
While they generally can't get legitimate items removed from your credit history, credit repair companies can also send "goodwill letters" to creditors. These usually point to a history of on-time payments or extenuating circumstances and request that late payments or other black marks be removed. There is no guarantee they'll be successful.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
Credit Saint offers three packages for credit repair services and a 90-day money-back guarantee for services. It has received an A rating and is accredited by the Better Business Bureau.
The Credit People's Credit Report Repair service is relatively affordable compared to other programs in the space. Even the most basic package (the standard package) includes unlimited challenges to all three credit bureaus. Upgrading to the premium package includes escalated disputes and monthly credit score reports and score refreshes.
How much does a credit repair company cost
Credit repair services usually have a one-time setup fee of $70 to $200, as well as monthly subscription fees of $50 to $100.
Many companies offer tiered plans that let you add more disputes and get faster results. Higher tiers also include perks like identity theft protection and credit monitoring.
How to choose a credit repair company
Before signing up for credit repair, make sure a company complies with the Credit Repair Organizations Act (CROA) and has a good rating from the Better Business Bureau. You can also read customer reviews and consult CNBC Select's list of the best credit repair services.
Be sure to get a clear explanation of its specific dispute methods and steer clear of any that guarantee they can remove something from your report or that advise you to make misleading statements or change your identity.
You should be able to get a free consultation before signing any contract. Make sure you understand all charges and find out whether the service charges a monthly fee or uses a "pay-per-deletion" model.
Get everything in writing and review any contract before you sign. You have 3 business days to cancel your credit repair service at no charge.
There may be variation among bureaus, but your credit report will typically contain information about your financial accounts, including:
- The date opened
- Credit limit or loan amount
- Current balance and fixed monthly payments
- Payment history over the past several years.
- Any bankruptcies or negative judgments
- Any statements of dispute you may have filed.
Your credit reports will also include your name, current and previous addresses, phone number, Social Security number, date of birth, current and previous employers and the names of anyone who has obtained a copy of your credit report.
Credit bureaus do not gather data about race, religion, medical history, sexual orientation, political affiliation, criminal record or any other information unrelated to credit.
Credit repair FAQs
What is credit repair?
Credit repair is the process of correcting inaccurate or dated information on your credit report. Credit repair companies cannot remove accurate and current information.
How long does credit repair take?
It can take several months to a year for an error to be removed from your report, depending on the issue, how many credit bureaus the error appears in and if they are disputing your request.
How much does credit repair cost?
Credit repair services usually have a one-time setup fee of $70 to $200, as well as monthly subscription fees of $50 to $100. Many companies offer additional benefits in tiered plans.
Can I repair my credit myself?
Yes, you can tidy up your credit history on your own. Request credit reports from the main three credit bureaus — Experian, Equifax and TransUnion — and verify that the information is accurate. Check for discrepancies with your name, address and other personal info, as well as with account details (like balances, credit limit and payment history) and anything sent to a collection agency.
If you find any errors on your credit report, start a dispute as soon as possible.
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