The risks of credit repair companies
We all know that the information on your credit report and your credit score are good indicators of your creditworthiness. So it stands to reason that we would want it to look its best.
Credit repair companies claim to be able to remove information from your credit report (especially the negative stuff like defaults) and usually in return for a high price or fee.
But here’s the problem with that. In most cases, information can only be removed if proven incorrect. If something is on there and it is correct, then it’s going to stay there.
The other really important thing to remember about credit repair is that you shouldn’t have to pay anyone to fix an incorrect listing. Why not? Well, you can do it yourself for free!
There are requirements for credit providers and credit reporting bodies in the Privacy Act and Credit Reporting Privacy Code, to investigate and reply to requests for corrections or notification of inaccuracies in their credit file. And even then if they can’t help there are independent resolution schemes. Check out our Key Resources page for details.
One final thing to look out for is that according to ARCA’s Credit Smart website “some credit repair companies may also try to convince you to enter into insolvency arrangements or to consolidate your debts with a high-interest loan. This may end up costing you more than if you had negotiated directly with your credit provider.”
With Credit Savvy, we will show you what is on your Experian credit file and alert you to any changes. This can help you find inaccuracies or mistakes and know who to contact to get them reviewed. This can help with peace of mind and of course, it’s free!