If you’ve ever searched “how to fix my credit,” you’ve probably seen ads for credit repair companies promising quick score boosts, wiped-clean reports, or even “guaranteed” results. But are credit repair companies legit? The short answer: some are lawful businesses that follow consumer protection rules, and some are outright scams. The real key is understanding what these companies can—and cannot—do, so you can choose wisely (or decide to DIY with confidence).
What a credit repair company actually does
Legitimate credit repair firms focus on identifying errors on your credit reports and disputing them with the credit bureaus (Experian, Equifax, and TransUnion). They may also help you organize supporting documents, track responses, and escalate disputes when needed. That’s valuable if you’re too busy or overwhelmed to handle the process yourself.
However, there’s a hard limit: they can’t legally remove accurate, timely negative information. If a late payment, collection, or charge-off is correct, it generally must stay until it ages off. Any company implying they can “erase” accurate negative data is waving a red flag.
Are Credit Repair Companies Legit? Look for the legal signals
In the U.S., the Credit Repair Organizations Act (CROA) requires certain protections. A legitimate company will:
- Provide a written contract that explains services, pricing, and timelines.
- Offer a 3-day right to cancel without penalty.
- Avoid upfront payment demands before services are performed.
- Make no false promises about results or “guaranteed” score increases.
Firms that comply with these rules and clearly set expectations can be legit. The trouble is many bad actors don’t follow the law—so you have to screen carefully.
Red flags to avoid
- “We guarantee a 100-point increase” or “We can delete bankruptcies/foreclosures no matter what.”
- Pressure to dispute everything (including accurate items) or to use fake identities (like CPNs).
- Requests for large upfront fees or payment before any work is done.
- Vague contracts, no disclosures, or refusal to explain your right to cancel.
- No realistic timeline—true investigations typically take 30–45 days per bureau.
What results should you realistically expect?
Credit repair works best when there are actual errors to correct—misreported late payments, duplicate collections, accounts that don’t belong to you, or balances that aren’t updated. If your reports are largely accurate, a credit repair company can’t legally “repair” much. In that case, improving your score comes from positive behaviors: on-time payments, lowering credit card utilization, adding positive history, and letting time do its work.
Costs vary, but many charge monthly (think subscription) or per-deletion. The most transparent setups bill after completing specific work, not before. Always compare the total expected cost versus what you could accomplish for free on your own.
DIY credit repair: you have the same rights
You can dispute errors yourself at zero cost. Start by pulling your reports from all three bureaus and highlighting inaccuracies. Then submit disputes with evidence (statements, letters, police reports for identity theft, etc.). Keep records and follow up.
- Get your credit reports: You’re entitled to free reports.
- Document errors: Note account numbers, dates, balances, and what’s wrong.
- Dispute with bureaus and furnishers: Provide proof and request a correction.
- Track responses: Bureaus typically respond within 30 days.
If identity theft is involved, place fraud alerts or credit freezes and file an identity theft report. When errors are fixed, verify that updates propagate across all bureaus.
How to choose a reputable credit repair company
- Check compliance: Do they follow CROA (no upfront payments, written contract, 3-day cancellation)?
- Demand transparency: Clear scope of work, itemized pricing, and realistic timelines.
- Ask about documentation: Will they send you copies of disputes and bureau responses?
- Look for specialization: Experience with your specific issue (mixed files, medical debt reporting errors, identity theft) can help.
- Read independent reviews: Look beyond testimonials on their site.
Bottom line: Some credit repair companies are legitimate and can save you time when real errors exist. But no one can legally remove accurate, timely negative information or promise guaranteed score jumps.
Smart alternatives if your reports are accurate
- Lower utilization: Aim to keep revolving balances below ~30% of limits (lower is better).
- Build positive history: Use a secured card or become an authorized user on a well-managed account.
- Set up autopay: On-time payments are the #1 scoring factor.
- Negotiate strategically: For collections, ask that the account be updated to “paid” and verify how it will be reported before paying.
- Consider non-profit counseling: Credit counseling agencies can help with budgeting and debt payoff plans.
Want the official guidance?
For consumer rights, common scams, and how to cancel a contract, review the Federal Trade Commission’s guidance on credit repair. It explains what companies can (and can’t) do and how to protect yourself. FTC: Credit Repair – How to Help Yourself
Final take: Credit repair companies can be legit if they follow the law and set honest expectations. But you have the same dispute rights they do. Whether you pay for help or go DIY, the winning plan is simple: correct errors, build positive payment history, reduce balances, and give your score time to reflect the changes.
