A Complete Analysis Of Credit File Repair By The Debt Settlement Companies



According to the types of services offered by the debt settlement companies, the business models may vary. A thorough analysis of these different business models is required for a better understanding of the debt settlement process.

Whether it is a debt settlement or financial recovery company, the types of services provided include:

  • Credit file improvement and repair
  • Administration of payment agreements with the creditors
  • Debt negotiation during settlement
  • Budget counseling and
  • Loans for debt consolidation and credit repair.

Accordingly, the models and business practices will vary to the extent that it may be very difficult for a layman to understand and determine key characteristic features such as the billing models and average fees. This is true for one specific category to another and even for industry-wide operation.

The debt settlement companies regularly mutate in their identification as per the types of services provided. Few may present them as a lender primarily instead of a financial-recovery company. On the other hand, there may be a few that present them as a law firm instead of a debt settlement company depending on the law followed by the state as few only allow law regulating debt settlement companies in the state.

To probe deeper into the types of services offered by the debt settlement and financial recovery companies you must understand the operation of it and identify it according to the service offered.

Credit file repair and improvement

This is perhaps the most significant category of service provided by the debt settlement companies. The companies that emphasize this aspect only are commonly known as financial repair or financial recovery companies.

The primary focus on these companies is to repair your credit file of the target clientele who has damages such as defaults, negative notes, excessively high debt, and others and no longer have any access to the traditional credit.

The representatives of the company usually work towards improving the credit score or file and at the same time promise to make the negative notes disappear from the credit report.

There are several means in which they do this and it includes:

  • Requesting a copy of the credit file of the consumerEquifax or TransUnion
  • Verifying the entries and accuracy of information in it
  • Intervening with the concerned department to rectify and repair the credit file and
  • Restore the access of the consumer to traditional credit.

Few of these companies may even offer or make arrangements for the loan if required knowing that making regular payments to the creditors is the best way to improve your damaged credit file. They will help you all the way to repay your loan most scrupulously so that it has a positive reflection on your credit file.

Right help when you need

When you work with a reliable and reputable debt settlement company, you will get the right help just when you need. Having a damaged credit file you will find it difficult to obtain a credit somewhere else even if you have the best intention to repay it back. Offering or arranging for a loan they will provide you with an excellent opportunity to restore the health of your credit report.

Moreover, they will offer you such loan amounts granted by the company are provided through credit cards or any other guaranteed loan source such as a third party within their network, of course with a high rate of interest. However, for all this, you will need to make scrupulous payments of the installments so that the future health of your credit file is guaranteed.

Just make sure that you work with a trustworthy company and choose one after reading the debt settlement feedback and reviews, checking their credentials and other certifications.

Few good companies will even provide you with a digital tablet with a specific application that will allow you to view the status and help you in better management and follow-up of your credit file. Through this specific app, you will get regular and timely reminders of your payment dates so that you can make the payment on time and such monthly installments are recorded to add a positive note to your credit file.

The fees and charges

The fees for providing such services to you may vary from one company to another. The websites of each will display it all in different categories. Few companies that claim them to be“affiliated partners” just like the financial recovery companies are most of the times related to the principal company.

However, the fees and charges will be explicit with a proper breakup of the different services and facilities provided. These services will include:

  • Credit monitoring
  • Scrutiny and analysis of credit file
  • Coaching and guidance to repair the damage
  • Tablet, app or other facilities provided
  • Fees for loans arranged and for the
  • Protection guarantee of your credit.

The fees are usually paid monthly for the time you enjoy their service but few may even charge you one-time.

The results expected

Obviously, you can expect a complete repair of your damaged credit file and some more from these debt settlement companies. You can also expect loans and credits, secured credit card, a consumer proposal and freedom from bankruptcy as well.

They will use all the necessary tools and instruments that will also ensure a regulated increase in your credit limit. They will ensure that you take each step carefully and strategically so that you duly achieve the required standard credit level of the banks and financial companies to get an access to traditional loans.

Ideally, a successful debt settlement company will help you to rebuild your credit within a period of eight to twenty-four months maximum. However, this is not a process in which you can expect overnight success. It is more like losing your weight which needs time, honest effort and due diligence.

Quick fixes are more likely to backfire and damage your credit health even more. Therefore, knowledge about the duration of the plan offered, professionalism of the company and how far they are abreast with the operation of a credit bureau, text clarity and the fees charged for the services offered.