What is Credit Repair? How it Works, Companies and Services

If you are suffering from bad credit, you may come across credit repair companies boasting about cleaning up your credit report and improving your credit score. When your finances are performing poorly and you are struggling with a less-than-stellar credit portfolio, these credit repair services can help you bounce back efficiently. While availing of these services seems to be a simple solution to resolve your credit-related issues, you must know how credit repair works, how they help repair your credit, and which are the best options available in India. Here is a guide that can help you make an informed decision.

What is Credit Repair?

The process of fixing your credit history, which might have deteriorated due to various reasons, is called credit repair. The repair process may involve simply disputing the wrong information present in your credit report or dealing with issues like identity theft. A damaged credit requires extensive repair work that involves various fundamental problems, like budgeting, legal actions, repaying due amounts, etc. After repair, your credit score will restore, the inaccurate and negative remarks on your credit report will go away, and your credit score will improve.

How Credit Repair Works?

The credit repair process involves contacting your credit bureau or company to dispute unfair or inaccurate information in your credit report. Sometimes, it requires only a few simple corrections, which you may request yourself. However, if it is a major issue and all the credit reports have it, professional credit repair companies will be more apt to handle the situation.

Mistakes in credit reports are not rare. If you find any inaccurate information in it, you may either do it yourself or hire a professional credit repair expert. The credit repair company will investigate the information and follow up until the credit bureau corrects it. These are the steps involved in the credit repair process:

• Requesting credit reports from credit bureaus

• Reviewing the credit reports and looking for any arrears, defaults, credit applications, or infringements that you are unaware of

• Contacting the credit bureau to correct the information

Importance of Credit Repair Companies and Services

If your credit report has errors and the credit repair company successfully removes it, it will no longer remain a part of the credit score calculation. Once your credit report becomes free of negative things, your credit score improves and your chances of getting easier loan approvals in the future increase. Credit repair companies and services are important due to the various negative effects of poor credit on your life and finances.

Firstly, credit repair makes it easier for you to get future loans. Reputable lenders feel convinced to approve your instant loan application, helping you get the best deal from preferable NBFCs. Moreover, getting a credit card with a decent credit limit and lower interest rate becomes easier, and you may qualify for better rewards programs. In short, repairing credit has numerous desirable effects with no downside. If your credit is bad, seeking help from credit repair companies will be in your best interests.

List of Credit Repair Companies

A decent credit score would be a magic key to your financial freedom. However, when your rating takes a nose-dive, a credit repair company sweeps in like a saviour. Today, let’s take a look at the top credit repair companies in India:

1. Credit Help India Services Pvt Ltd: Since 2014, they have had a dedicated team of counsellors who are well aware of how credit repair works and how to make it happen.

2. Apoorvaa Foundation: The company has a certified team of credit repair experts helping folks with free credit counselling sessions.

3. First Credit Services: With a history of over 25 years, it is a champion in customising repair programs for customers.

4. Trinity Credit Solutions: Based in Bangalore, Trinity is a wizard offering credit holders a wide range of repair services.

5. Credit Check India: For years, they have been finding bugs in credit reports and tackling them with personalised plans to polish credit scores.

Credit Monitoring and Score Tracking

If you are a regular credit user, you must consider monitoring your credit and tracking your score at frequent intervals. It will help you keep an eye on your accounts and control your finances. With credit monitoring and score tracking, you get an alert whenever the score dips, and you must act to save it. Credit bureaus create your credit report as soon as you seek credit for the first time. Regular monitoring makes you watchful whenever you overspend, encouraging you to control your expenses and reduce reliance on credit.

Identity theft is another issue you can prevent with regular monitoring. If someone else opens a credit line or takes a loan or credit card in your name, it will reflect in your credit report, and you can take timely action to handle it. Credit monitoring keeps you aware of the payments and balances in your credit products, giving you a clear idea of the expenditure and DTI (Debt to Income Ratio).

Conclusion

Now that you know what is credit repair and how credit repair works, it's time to hire a reputable company and bring your score on track. Improving your credit score is one of the most successful Personal Loan tips that work in your favour when you seek credit.

Frequently Asked Questions

1. What is the credit repair process?

The credit repair process involves reviewing the credit report, finding any errors in it, and reporting them to the credit bureau or credit provider to request correction.

2. How profitable is credit repair?

Credit repair is extremely profitable as it increases your credit score, improving your eligibility for better loan deals in the future.

3. What is credit repair now?

Credit repair is the process of repairing the credit score when it is low, resulting in an improved credit rating.

4. How important is credit repair?

Credit repair is extremely important, as your eligibility for credit and associated terms and conditions largely depend on your credit score.

5. Why is poor credit bad?

Poor credit is bad because it projects you as an irresponsible borrower with a high risk of default. As a result, lending institutions feel unsafe lending you credit, convincing them to reject your loan application.