Credit repair companies

Be clear on what they can and can’t do

If you’re worried about your credit rating, or need some help dealing with debt, it might seem like a good idea to use credit repair companies.

Proceed with caution. Some business who say they can help people struggling with debt actually can’t, yet charge hefty fees that just add to your problems.

Many are really debt consolidation companies who want to loan you more money, complete with high interest rates and upfront or commission fees.

You don’t need to pay more money to get out of debt

Can they do what they claim?

  • As advised by the government’s Money Smart website, it’s important to be wary of ‘credit repair’ or ‘credit fix’ companies.
  • These businesses often claim they can improve your credit report. But if you know the information in your credit report is correct – there’s nothing they can do about it. No matter what they claim.
  • Information can only be removed from or updated on your credit report if it can be proven that it was reported in error.

What credit repair companies can do

  • A credit fix or repair agent can act on your behalf to challenge any listings on your credit report that you believe are incorrect.
  • Rather than doing it yourself, due to time, using a credit repair agent can be a good fix.
  • But be sure that you clearly understand what they can and will do, and how much it will cost you. If any of this information seems vague or unclear – walk away.

A costly solution

  • Credit repair companies are in business to make money from people like you who are in debt.
  • Money Smart report that some credit repair agencies charge fees as high as $1000 to fix just one listing on your credit report.
  • In many cases, high fees are charged even when they’re unable to remove or change information on your credit report.
  • Don’t kiss that much of your cash goodbye when you could have this done for free.

Know who you’re dealing with

  • To understand some of the concerns around some credit repair agencies, read ASIC’s report.
  • Debt consolidation companies must be licensed by ASIC. If you’re considering using one, search their professional registerto check their licence.

Clean up your credit yourself, for free!

We know it’s tough out there

At City Finance, we’re different to other lenders. We understand how tough it can be to make ends meet and are here to help. City Finance always takes the time to get to know you. We focus on your unique situation to tailor a loan and repayments around you and your needs.

Whether you need new finance or want to discuss making changes to your existing arrangements, call us on 1300 34 62 62 or pop into your local branch today for a chat with our friendly staff, and together we’ll work on a solution to see you through.

This article is provided as a guide only and does not constitute financial advice. We encourage you to do your own research through the Australian Financial Security Authority and Moneysmart to reach a debt management solution that is appropriate for you.”