Good credit entails better interest rates on cars, homes, and credit cards and easier access to rental apartments with utilities. It also paves the way for better job opportunities.
Consumers with bad credit won’t have the same access to the amenities mentioned above. They often employ the help of credit repair companies to help amend their negative credit report and increase their credit score.
Credit repair and credit restoration are often used in the same context. Are they similar or different from one another?
Let’s find out.
Are Credit Restoration And Credit Repair The Same Thing?
Yes. Credit repair, also known as credit restoration, is the process of disputing inaccurate information on credit reports to improve poor credit scores.
Credit repair or restoration does not include disputing incorrect items on your credit report. That falls under the jurisdiction of credit building.
Put simply, the credit repair process only covers fixing mistakes from the past, while credit building focuses on improving credit by planning for the future.
On the other hand, the term credit restoration pertains to a paid service offered by a company. Credit repair is allowed to be used in the same context.
It’s important to note that credit restoration does not include disputing incorrect items on your credit history. It only contradicts information that is unfair or unfounded.
Through the Fair Credit Reporting Act (FCRA), consumers have the legal right to correct any incorrect information on their credit report. After this, the credit reporting agency and creditors assigned to you are given 30 days to review your case. They can either verify it as correct or delete the errors and wait for them to get verified.
How Does Credit Repair Or Credit Restoration Work?
Credit restoration is when you contact credit bureaus and sometimes creditors to amend the errors reflected in your credit report.
The best way to do this is to hire experts that can help you appeal for your case. Consumers typically contact credit report companies to help them reach three major credit bureaus that can review their credit history.
Professional credit repair services can let you know the legal rights that can help you understand how to proceed with your case.
Some states, like Georgia, implemented the Credit Repair Organizations Act or CROA to ensure that no consumers become victims of fraudulent credit repair companies.
It’s essential to check whether a credit repair company is legitimate. Here are some of the ways for you to identify that you can trust a credit repair company:
- They don’t ask for a service fee unless they have finished the work.
- They walk you through your legal rights and the options you have that can lessen the cost of credit restoration on your part.
- They won’t ask you to assume another person’s identity, such as taking their social security name. They also must not suggest that you must create a new credit line.
If you want to know more about the process of credit restoration and how you can improve your credit report, don’t hesitate to contact us.