There are no loans that are specifically classified as credit repair loans. There are lenders that will qualify even people with recent bankruptcies and/or very low credit scores for loans. Usually these lenders charge higher interest rates, because they believe they are taking a greater risk.
If you search for credit repair loans on the internet, you will see credit repair services, attorneys, loans for people with bad credit and all sorts of other businesses. You will find companies which offer to help you find the right credit card or loan. You will even find credit counseling services. Consumer credit counseling services are non-profit counselors that help people create a budget and repay their debts. They do not help people repair their credit. You will get different advice form counselors that specialize in debt management and those that specialize in credit repair.
You may see consolidation loans advertised as credit repair loans, but according to FICO, simply moving your debt around will not improve your credit score. Debt management counselors will advise you to maintain one credit card and use it only for emergencies, paying off the balance each month. FICO advises that closing accounts simply because you do not use them will not increase your credit score and may actually lower it. One of the factors used to determine credit scores is available versus used credit. As you get closer to your credit limit, your score goes down.
Anytime that you consider applying for any type of loan (credit repair loans, debt consolidation loans, etc.), you should read the fine print and shop around. If you are shopping for the best interest rates and you must allow lenders to access your credit report, try to have multiple inquiries completed within thirty days. Multiple inquiries may lower your credit score, but inquiries made by several different banks within a short period of time will be considered as one inquiry and should not lower your score.
If you are trying to improve or establish credit, a secured credit card or being listed as a co-applicant on a friend or family members account may help. Credit repair loans may not. You can improve your credit score by having inaccurate information removed from your credit reports. You can pay down the balances on your credit cards so that you have more “available” credit. Credit repair loans that just combine the balances from other cards or loans will not improve your credit score.
For more information about credit repair loans or for general information about credit repair, visit http://creditfixnow.blogspot.com.
The writers and editors at the Credit Repair Blog are dedicated to providing accurate information about credit repair issues.
Written By: Patsy Rose
