What is Credit Restoration and is It Worth It?

Consumer prices and inflation are at record highs, and people are feeling it. Whether it’s at the gas pump or the grocery checkout, we’re all seeing the costs of living go up. To combat this, whether it works or not, the Federal Reserve is increasing interest rates every quarter. 

When interest rates go up, it becomes even harder to borrow money. Whether it’s for a car, for a home, or even just to keep up on our credit card payments. If your credit has suffered negative marks or collections, it may be time to hire a Credit Restoration company.

So What is Restoration?

Credit restoration applies to any credit score or credit report that is in less than optimal shape. Specifically, it can refer to someone who hasn’t used their credit in a long time, or whose accounts have been closed.

To restore credit, a professional company or advisor can help you find secure credit cards, errors in your report, or even help you remove items that aren’t errors but are hurting your score.

Restoration usually takes three forms. A good company will do at least two of these. Great companies do all three.

Check For Errors

If your credit has suffered from delinquencies or late payments, it’s possible that the creditors have made errors regarding dates and amounts. These errors can cost your credit score, and that can cost you money.

I recently broke down what kind of credit you need for a good car loan, and the difference between a low credit score and a high one can mean hundreds of dollars less a month.

Contact Creditors

Mechanics know cars, plumbers know pipes, and a credit restoration company knows how to talk to creditors. When a lay person like you or me calls a creditor, we have less than good odds at getting an item removed or forgiven. But credit restoration companies know how to flood the system with disputes and letters until you get the results you need.

Advise on Next Steps

Credit scores and improving them can seem like an arcane art. That’s why it’s important to have someone on your side who knows how to move the needle. Credit restoration companies can help advise on which of your credit cards to pay off first, which loans are good ideas, and even help provide you with a road map to your ultimate goals, like owning a home.

What Restoration Looks Like

Once you have contacted a good restoration company, they’ll work with you to remove negative items, pay down cards you want to keep, and open new lines of credit that will increase your debt ratio.

Many restoration companies can get you a boost to your credit score in only a couple of months. 

By reducing the negative marks, increasing how much you can borrow, and decreasing what you owe, restoration will address all the major areas of your credit report.

Once your credit scores improve, you’ll begin to see lower interest rates on credit cards and other loans, and that means you can borrow more money for big purchases, and pay less for the loans.

Is It Worth It?

There’s an old saying that you can’t put a price on a good reputation. Well, when we’re talking about a financial reputation, maybe you can put a price on it. In my article explaining the three credit bureaus, I showed how our credit is basically a measure of our character.

If we have good financial “character,” then we’re going to see lower credit card interest rates–which saves us money on our bills. And we’ll also see better deals on home and car loans–which saves us even more money.

In extreme cases, having bad credit can even impact whether we can get an apartment or even a job.

When it comes to those types of consequences, I would absolutely say that credit restoration is well worth it. As long as you’ve found a reputable company.

All of the companies I’ve recommended in the past come with great reputations, and many come with money back guarantees. And that guarantee makes it worth it almost no matter what.

About the author Greg Lorenzo

Greg is a financial expert who has been advising his audience on loans for over 10 years. He has a wealth of knowledge and experience in the area, and he is passionate about helping people get the best possible deal on their loans. Greg is an expert in negotiating loans, and he has a proven track record of getting his clients the best possible terms. He is also a strong advocate for financial literacy, and he regularly gives workshops and seminars on the topic.

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