The best credit repair services won’t create false hope for a “miracle cure”, but they definitely do help with the sometimes overwhelming task of improving your credit score. These companies aren’t a panacea for financial mismanagement, however the best credit repair usually can help significantly to improve your credit score.

There are hundreds of credit repair services advertising today, but the Federal Trade Commission considers most of them to be scams. Companies that claim they can help you erase bad credit, or offer guarantees to raise your credit score, are probably scams.

According to the Federal Trade Commission, you can’t remove accurate and timely negative information legally from a credit report. Even though many of these companies will suggest you dispute all negative entries on your credit report, you do so at your own risk. In most cases, this is illegal, even if you are following their advice.

The best credit repair services won’t ask you to pay in order to get your credit reports. Under federal law, anyone can get their credit report from each of the three credit-reporting agencies (TransUnion, Experian, and Equifax) once every twelve months for free.

Much of what these companies do are things you can do yourself, however they can often help inform those who may not be aware of all their options. Taking on some of these tasks can help lower fees, or you can chose to do the whole thing yourself.

It is important to differentiate between credit repair services and “debt consolidators”. A debt consolidator does not try to fix your credit, but rather works to help you bring your outstanding debt under control.

Debt consolidators do this by contacting your creditors on your behalf. They will negotiate a ‘settlement’ agreement, usually just a fraction of the actual amount owed. The debt consolidator will combine these settlements into a single amount. They will give you an amount within your budget to send them each month, and in turn they send a portion to each creditor.

The best credit repair services won’t help much if the factors that led to credit problems don’t change. Further, they don’t provide the kind of “bailout” that erases bad debt like filing bankruptcy will. That being said, what they can do is help you to get your feet back on the ground and help set you on the road to improving your credit score, and in turn your whole financial future.

There are ways to repair your credit after a bankruptcy. Although these systems will not help immediately, they can be used to help repair your credit over time. Taking the needed steps to erase the bankruptcy record from your report or to improve your credit after a bankruptcy can place you on the right track to prepare your credit report and score for the future.

What can you do about a bankruptcy in your credit file?

Any derogatory accounts that were discharged during bankruptcy will be shown as either “BK Liq Reo” or “Charge-off.” The bankruptcy will itself appear under the public record section as a Ch. 7 or Ch. 13.

The best way to remove a bankruptcy from your credit file is to dispute it with Experian, Transunion and Equifax directly. Find some mistake in the actual bankruptcy claim; you can usually discover errors since a person had to add the bankruptcy into your credit bureau record.

One of the major potential challenges you can dispute in a bankruptcy is the dollar amount of each account in question. Many times creditors will round up the account balance number to the nearest dollar for accounting purposes. This can be challenged since the actual amount is technically not correct. In many cases, the bankruptcy is ordered removed.

Sometimes bankruptcies are easier to remove than other items on your credit file. Why? Because bankruptcy files include a lot of information, so the probability of mistakes is extremely high, and they are often reported by busy overworked court clerks.

Working with municipal courts is quite different from working with typical creditors. Getting the courts to cooperate will make it difficult for the credit bureaus to respond to your dispute letter within the allotted time, and the court’s lack of organization can work to your advantage.

When sending your dispute letter, make sure that it is addressed to the three major credit bureaus, not to the local court that maintains the bankruptcy file. The bureaus must correct or verify any errors within a certain period (usually 30 days) or remove them from your credit record. It is not difficult to find some mistake in all the bankruptcy papers, so use this to your benefit.

Remember that bankruptcy is not the end of your credit life, and it can even be easy to fix compared to the many minor negative items that may appear on your report. Look over your bankruptcy records completely, determine if there are any mistakes, and then make your claim with the bureau demanding them to remove it from your credit report so that you can have a fresh start.