There are many credit repair agencies and credit counseling services out there, which will offer to fix your credit for a fee or reduce your payments. Some of them make outrageous and false claims, and there is nothing they do that you can’t do for yourself. Credit repair agencies often work by getting your credit report and disputing every single item on it.

If the creditor does not provide evidence that the entry is correct within 30 days, then the item must be removed. But there’s a catch, the item can be added back in later if the creditor re-submits it, so disputing a legitimate item may result in getting that item off your record, but it is likely to be off your record only for a short period of time.

Credit counseling services work in a variety of different ways, but try to negotiate lower interest or settlement payments with your creditors in order to lower your bills. While making a settlement offer, such as paying off a debt at a discount, may get a creditor off your back, such a payment still results in points against you on a credit report.

Though they may seem beneficial, credit counseling agencies often charge hefty fees, and may not be all that effective. Some of these agencies are non-profit; but be aware that this status does not make them any more effective or legitimate than any other counseling service. Also, the fact that you are using a credit counselor is noted in our credit report, and it is not always look upon as a positive thing by a lender.

The notation “under debt management” is entered on your report and stays there until all debts under the program have been paid off, and most mortgage lenders, even subprime lenders, will stay away when they see that notation.

Yes, there are many credit repair agencies and counseling services available. However, it’s better to find one locally, where you can physically go into an office and have a face-to-face conversation with somebody and explain your situation.