Whenever you browse through social media, especially in the personal finance space, you’ll probably come across a message like “Fix your credit score now!” If you click on the link, you may end up on a website that swears it can get you a credit score of 750 in just a few months. But are credit repair companies legit? And most importantly, do credit repair companies work?

Legit Credit Repair Companies

While there are many scams, there are a few legit credit repair companies out there. These companies help you with monitoring your credit score and offer you the education to make sure you’re credit savvy in the future. Plus, they can work with you on debt settlements.

Not only will these services help you boost your credit score, but they can also help you work up the confidence and knowledge needed to make better financial decisions in the future. It’s important to remember that the companies you’ll want to use won’t offer a “pay once and get it all done” type of service. In fact, an honest company can take months to fully restore your credit score. It’s the slow and steady approach that wins the credit repair race.

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A chart showing what a good credit score can and can't do for you

Watch Out for the Shady Ones

For every legitimate credit repair company, there are a ton of shady ones. These companies can steal your information and do some serious damage to your credit report. No one wants to wind up the victim of a scam, so make sure you know the difference between an honest credit repair company and one that is not on the up-and-up.

Further Reading: “The Ultimate Guide to Credit Repair”

Credit Repair Companies Are Expensive

You’re unlikely to find a legit credit repair company that’s cheap. So if you’re serious about using one, just know that you’ll be paying a pretty penny to do so. For example, many companies charge both an initial fee and a monthly fee of $79 and up.

Unless you really need your credit score fixed within the year, a credit repair company may not be the best option for you. There are plenty of ways to raise your score without this sort of service. However, if you need to boost your credit score quickly in order to qualify for, say, a mortgage or a car loan, a credit repair company may be the way to go.

Are Credit Repair Companies Worth It?

Even though credit repair companies do work, you shouldn’t feel as if you need to use them. In fact, your credit score shouldn’t even be the most important number in your book. Here’s why.

It measures your debt worthiness.

Think about it: Your credit score doesn’t reflect anything about you besides your worthiness to get into and out of debt. Your credit score reflects who you owe and how much you owe, and it doesn’t take into account the money sitting in your bank account. A good credit score doesn’t necessarily mean that you’re financially stable.

Not having a credit score isn’t a sign that you’re being foolish with your finances. In fact, it can indicate the opposite!

In reality, your credit score typically matters only if it’s a bad one.

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You can make smart money moves without it.

If you’re paying for everything in cash and aren’t in debt, you shouldn’t worry about your credit score. While it is a common misconception that a good credit score grants you many opportunities, it really doesn’t.

You don’t need a good credit score to invest or save money. And there are ways around needing a credit score to rent an apartment.

For instance, my first landlord wanted a cosigner on my lease because I didn’t have a credit score (I had never needed credit). Instead, I negotiated: I asked her if she would rather I have no credit or bad credit, then showed her my savings account balance. Wouldn’t you know it, I got the apartment. Many businesses don’t care about your credit score, especially if you can prove that you’re more than capable of paying for what you want and need.

It’s only useful for those with specific needs.

The only people who should ever have to worry about having a good credit score are those who plan on taking out student loans, car loans, mortgages, and other types of loans. If you’re starting a business, a credit score may be helpful, but there are many ways to establish and run a business without spending a ton of money.

At the end of the day, credit repair companies can and do work. However, unless you really need to use one, it’s best to steer clear.

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