Remembrance of Financial Catastrophes Past
June 24, 2014 9:20 AM Subscribe
Asking on behalf of a friend (let's call her "Liz"): can a credit restoration company help fix a credit report with multiple charge-offs? If not, what CAN be done? Sadly drifting swirls of bleak gray snowflakes within...
posted by julthumbscrew to Work & Money (9 answers total) 2 users marked this as a favorite
In a nutshell: Liz had great credit until the late aughts. However, 2007-2009 were personally and professionally disastrous, and during this period, she had roughly six credit card accounts (of several thousand dollars apiece) reported as charge-offs by their respective lenders.
Liz is doing pretty well financially at present - she's got a good job, a consistently-paid mortgage, low revolving debt, and a modest nest egg. However, she'd like to move in the next few years and is worried that the charge-offs will prevent her from getting a new mortgage.
A local "credit restoration" company told Liz that they'd be able to resolve these debts and improve her credit for roughly $15K. She can afford it, but wants to do due diligence before dropping such a big sum.
Liz's questions for you, oh wise Hive:
- Does credit restoration work for people who are NOT in imminent financial peril (that is, people who are contending exclusively with OLD bad debt)? Most credit advice seems geared towards those who are actively hemorrhaging money, NOT people whose past bad decisions are haunting them.
- What sort of questions should she be asking the restoration company? What sort of guarantee/contract, if any, should she demand?
- If working with an agency is NOT a good idea, what recourse does she have? She's familiar with the MeFi-favorites (CreditBoards.com, the NFCC and CCCS).