Do these agencies that say they can repair your credit, lower your interest rate and cut your debt legit???

Question

Are they legit?

Does it damage your credit to go through these guys since they lower your credit card debt and your insterest rates? And accumulatet them into one payment?

I would think it would because it shows you need help....

Has anyone gone through one of these non profits?

Thanx

Answer 1

Most credit repair companies are scams. They take their fees up front and trash your credit. A common tactic is to hold the money you send and not pay your creditor for several months. Then they offer settlement for half or threaten bankruptcy.

If you really need help, go to: http://www.nfcc.org/ . Consumer Credit Counseling Services (CCCS) offers free counseling. They can look at your finances and advise you how to proceed.

You can clean up your debt yourself. Start by setting up a strict budget. Eliminate all the extras -- cell phone, eating out, new clothes, etd. Put every penny you can squeeze out of that budget on the highest interest rate debt, while making minimum payments on the rest. When the highest rate is paid off, move to the next till they are all paid off.

If you work at it, you can pay if off in 2 or 3 years. Finding additional income will make it faster. Have a garage sale, collect alum cans, get a second job -- pizza delivery has flexible hours.

Answer 2

Don't waste your time with credit repair companies, you can repair your credit on your own by looking at your credit reports, and disputing them with the creditor and credit reporting agency when the entries are incorrect and negotiating your own settlements. Or if you need to consolidate debts, it would be better to get a normal loan for the amount of the total debts and then pay off the other debts. That accomplishes the consolidation. Of course, if your credit isn't so good you might not get a good interest rate.

Answer 3

There are two types of these companies. You can tell if they are legit based on whether or not they make you pay. If they require fees, then it's a scam. No one is going to give you a loan to pay all your stuff without ridiculous interest rates or some other major catch that will likely make your situation worse. I can almost guarantee it. If not, they are legit, BUT- they are basically going to tell you to cut up your credit cards, make a budget, and stick to it... and little else. The legit ones will merely counsel you. They won't solve your problems. Ultimately, your credit is in your own hands. Learn how to manage your money, pay your bills on time at all costs, and wait. That is how your credit gets better. Good luck!

Answer 4

Yes, I used one--consumer credit counseling of south florida. Their fees were excessive, hidden and lied about (when I found the hidden fee in the contract and asked about it point blank and was told that an amount up to that maximum would be used to offset administrative expenses as they came up--turned out it was a standard monthly charge.)

Despite that, they did everything they said they would. They got me better rates (except that Discover won't work with them), had everything down to one payment, and I had zero debt (from $12000), and credit offers started rolling in. They do not settle for a lower amount than your balance (they just make it possible for you to actually pay off your balance), so these accounts show positively for you on your credit when you have finished the program. This was not a loan, it's a repayment program--it is just a series of agreements entered into between you, the program, and the card companies to allow you to pay one amount and have it distributed to all your creditors.

Even though I was mad about being lied to about what the program costs, on the whole I'd say I had a positive experience with them, and I have good credit now. I'm not sure it would have been possible to do that in under three years by myself.

Answer 5

Even if these people do what they say they will, any future lenders will turn their nose at you because credit counciling is the same as bankrupcy to them.

Answer 6

yes, but they make it worse before it gets better, plus
you can do it yourself for free
creditinfocenter.com