If you have bad credit and have been thinking about working with a credit repair firm, think again. Credit repair services aren’t doing anything that you can’t otherwise do for yourself. They review your credit history, lodge disputes, follow up, rinse and repeat. The appeal of a credit repair service is that they spend all that time resolving issues so that you don’t have to. They can’t take legitimately negative things off your record and they can’t work magic. Any firm that promises or guarantees to improve your score isn’t telling you the whole truth and you should watch out.

If you think about how the credit score works, there is really only a handful of things that you can change or remove that will be of any benefit. It pretty much comes down to removing negative items from your report and those come in two varieties – accurate and inaccurate. The inaccurate ones are easy to get rid of, the accurate ones are not.

All you need to do to remove an inaccurate item is to dispute it and follow up. This can take quite some time and so herein lies the appeal of credit repair companies. The question you must ask yourself is whether you want to pay someone to do this or if you would rather do it yourself.

How about the accurate negative items? There are cases where credit repair services have gotten negative legitimate items removed – they simply ask politely. Much like how you can get a fee refunded, you can often ask a creditor to remove a negative item because you’ve had an otherwise stellar history with them. Many companies are willing to do this if you are a good customer because it comes at no cost to them. Again, you can do this yourself or pay someone to do it for you.

Finally, repair companies, both reputable and disreputable firms, will send letters disputing all negative items on your report without regard for its accuracy. If a credit doesn’t respond within 30 days, that information is deemed unverified and subsequently removed. While not ethical, you can do this yourself. Don’t get your hopes up though, this is often easily verified.

It’s important to know that legitimate credit repair companies aren’t miracle workers, they simply push the paperwork on your behalf. Unfortunately, you have to wade through a lot of fly-by-night scams to get through to legitimate companies. My recommendation is that you skip the services, save your money, and learn how to do it yourself.

Jim writes the blog Blueprint for Financial Prosperity.

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