{"id":8625,"date":"2022-01-26T19:48:08","date_gmt":"2022-01-26T18:48:08","guid":{"rendered":"https:\/\/businessfinancenews.com\/?p=8625"},"modified":"2023-08-24T16:19:05","modified_gmt":"2023-08-24T15:19:05","slug":"does-credit-score-affect-car-insurance","status":"publish","type":"post","link":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/","title":{"rendered":"Does Credit Score Affect Car Insurance"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\" id=\"how-does-credit-score-affect-car-insurance\">How Does Credit Score Affect Car Insurance?<\/h2>\n\n\n\n<p>If you have bad credit, you&#8217;ll likely face higher than average car insurance rates. Find out how much higher, and why.<\/p>\n\n\n\n\t\t\t<div class=\"wp-block-image\">\n\t\t\t<figure class=\"aligncenter\"><img decoding=\"async\" src=\"https:\/\/web.archive.org\/web\/20210224175922im_\/https:\/\/quotewizard.com\/media\/4169\/car-insurance-credit-score.jpg\" alt=\"credit score image showing good credit\"\/><\/figure><\/div>\n\t\t\n\n\n<p>Insurance companies typically consider your credit score to set your auto insurance premiums. They use your credit score to determine your auto insurance score. The higher your auto insurance score is, the lower risk you likely are, and the lower your insurance rates may be. So, a bad credit score usually means higher insurance rates.<\/p>\n\n\n\n<p>Unless you live in California, Hawaii, Michigan or Massachusetts, which ban the practice, your insurer will likely use this score to determine your rates. They use it to predict the likelihood of a customer filing a claim. This article covers everything you need to know about credit scores and car insurance, including:<\/p>\n\n\n\n<ul><li><a href=\"https:\/\/web.archive.org\/web\/20210224175922\/https:\/\/quotewizard.com\/auto-insurance\/credit-score#influence\" data-lasso-id=\"5855\">How your credit score influences your auto insurance rates<\/a><\/li><li><a href=\"https:\/\/web.archive.org\/web\/20210224175922\/https:\/\/quotewizard.com\/auto-insurance\/credit-score#companies\" data-lasso-id=\"5856\">How companies use your credit score to set premiums<\/a><\/li><li><a href=\"https:\/\/web.archive.org\/web\/20210224175922\/https:\/\/quotewizard.com\/auto-insurance\/credit-score#score\" data-lasso-id=\"5857\">What is an auto insurance score?<\/a><\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"influence\">How does your credit score affect auto insurance rates?<\/h2>\n\n\n\n<p>As your credit score increases, your annual car insurance rates tend to decrease. According to our data, having a \u201cworst\u201d credit score versus an \u201cexcellent\u201d credit score can&nbsp;<a href=\"https:\/\/web.archive.org\/web\/20210116145609\/https:\/\/quotewizard.com\/auto-insurance\/why-did-my-car-insurance-rates-go-up\" data-lasso-id=\"5858\">raise<\/a>&nbsp;your annual insurance rates by 112%. Having an excellent credit score can lower premiums by $1,882 annually.<\/p>\n\n\n<div class=\"wp-block-image size-large\">\n<figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"416\" src=\"https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/01\/image-4-1024x416.webp\" alt=\"\" class=\"wp-image-8626\" srcset=\"https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/01\/image-4-1024x416.webp 1024w, https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/01\/image-4-300x122.webp 300w, https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/01\/image-4-768x312.webp 768w, https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/01\/image-4.webp 1041w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure><\/div>\n\n\n<p>Drivers who don\u2019t provide a credit score (categorized as \u201cnone\u201d) are estimated to have a lower premium than those with bad credit scores. However, even if you don\u2019t provide your credit score, your insurance company may analyze your credit score when you provide your Social Security number. Your final rates will then be calculated off that score combined with other factors like your driving record and location. For an accurate quote, provide your credit score when you first begin shopping for insurance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"companies\">Insurance companies and credit scores<\/h2>\n\n\n\n<p>Insurance companies weigh your credit score differently to determine your insurance premiums. How much your credit score impacts your insurance rates depends on your insurer. We compared rates and credit scores from major auto insurance companies in Texas:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><th>Credit rating<\/th><th>Allstate<\/th><th>GEICO<\/th><th>Nationwide<\/th><th>State Farm<\/th><th>USAA<\/th><\/tr><tr><td>Worst<\/td><td>$2,336<\/td><td>$3,020<\/td><td>$3,912<\/td><td>$3,482<\/td><td>$3,586<\/td><\/tr><tr><td>Below Fair<\/td><td>$2,091<\/td><td>$2,373<\/td><td>$3,813<\/td><td>$2,416<\/td><td>$2,454<\/td><\/tr><tr><td>Good<\/td><td>$1,881<\/td><td>$1,781<\/td><td>$2,501<\/td><td>$1,776<\/td><td>$1,480<\/td><\/tr><tr><td>Excellent<\/td><td>$1,676<\/td><td>$1,389<\/td><td>$2,099<\/td><td>$1,195<\/td><td>$1,289<\/td><\/tr><tr><td>None<\/td><td>$2,277<\/td><td>$2,236<\/td><td>$3,278<\/td><td>$1,977<\/td><td>$1,968<\/td><\/tr><\/tbody><tfoot><tr><td>Note: Average rates are based on non-binding estimates provided by Quadrant Information Services. Your rates may vary.<\/td><\/tr><\/tfoot><\/table><\/figure>\n\n\n\n<p>Out of the major insurance companies we compared, we found that State Farm charges the highest increase from bad to good credit score, raising prices an average 191%. According to our data, Allstate has the lowest rates for a bad credit score, charging around $2,336 annually.<\/p>\n\n\n\n<p>A clean driving record and good insurance score can lower your costs.&nbsp;<a href=\"https:\/\/web.archive.org\/web\/20210116154034\/https:\/\/quotewizard.com\/auto-insurance\" data-lasso-id=\"5859\">Compare rates<\/a>&nbsp;to see how much you can save with a good insurance score.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"why-do-car-insurance-companies-check-your-credit-score\">Why do car insurance companies check your credit score?<\/h3>\n\n\n\n<p>Insurers believe there is a connection between credit scores and the likelihood and number of insurance claims filed. So, they use a driver\u2019s credit score to determine their insurance score. However, it\u2019s a controversial practice. Arguments are made in support of drivers with poor credit. They may be more likely to file a claim because they lack the resources to pay for repairs on their own.<\/p>\n\n\n\n<p>If insurers are able to charge more based on credit scores, it helps justify higher premiums. This has led some consumer advocates to label the insurance industry\u2019s scoring practices as unfair. It helps those with good credit while negatively affecting low-income drivers who would benefit the most from lower rates.<\/p>\n\n\n\n<p>Legislatures in&nbsp;<a href=\"https:\/\/web.archive.org\/web\/20210117213047\/https:\/\/quotewizard.com\/auto-insurance\/california\" data-lasso-id=\"5860\">California<\/a>,<a href=\"https:\/\/web.archive.org\/web\/20210127064342\/https:\/\/quotewizard.com\/auto-insurance\/massachusetts\" data-lasso-id=\"5861\">&nbsp;Massachusetts<\/a>,&nbsp;<a href=\"https:\/\/web.archive.org\/web\/20210127075531\/https:\/\/quotewizard.com\/auto-insurance\/michigan\" data-lasso-id=\"5862\">Michigan<\/a>&nbsp;and&nbsp;<a href=\"https:\/\/web.archive.org\/web\/20210117210127\/https:\/\/quotewizard.com\/auto-insurance\/hawaii\" data-lasso-id=\"5863\">Hawaii<\/a>&nbsp;have laws that ban insurance agencies from using credit as a factor in determining car insurance rates. Some insurance companies don\u2019t use credit as part of their underwriting process.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"do-insurance-quotes-affect-your-credit-score\">Do insurance quotes affect your credit score?<\/h2>\n\n\n\n<p>No, getting car insurance quotes won\u2019t affect your credit score. Shopping for car insurance won\u2019t lower your credit score in the same way applying for credit cards will. That\u2019s because auto insurance companies don\u2019t do a hard credit pull for car insurance quotes like credit card companies do.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"score\">What is an auto insurance score?<\/h2>\n\n\n\n<p><a href=\"https:\/\/web.archive.org\/web\/20210304214815\/https:\/\/quotewizard.com\/auto-insurance\/what-are-car-insurance-scores\" data-lasso-id=\"5864\">Auto insurance scores&nbsp;<\/a>are credit-based scores that your auto insurance company calculates to determine how risky you are to insure, or how likely you are to file an insurance claim. Like a credit score, the higher your insurance score is, the better. If you have a good insurance score, your premiums should be lower.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"how-insurance-scores-are-calculated\">How insurance scores are calculated<\/h3>\n\n\n\n<p>The criteria for calculating a consumer\u2019s insurance score varies by insurance company. Each insurer uses its own method to decide scores. However, the most common factors used include:<\/p>\n\n\n\n<ul><li>Length of credit history<\/li><li>Payment history<\/li><li>Amount of outstanding debt<\/li><li>Available credit<\/li><li>Monthly account balances<\/li><li>Amount of revolving credit versus the amount of loans<\/li><li>A high number of credit inquiries<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"what-is-a-good-auto-insurance-score\">What is a good auto insurance score?<\/h3>\n\n\n\n<p>Each company uses different standards to determine insurance scores. However, many experts suggest you stay in the mid-700s and above range. According to most agents, a bad insurance score would be anything below 500.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"rate-methodology\">Rate methodology<\/h2>\n\n\n\n<p>To find the\u00a0<a data-lasso-id=\"5865\" href=\"https:\/\/web.archive.org\/web\/20210128105841\/https:\/\/quotewizard.com\/auto-insurance\/best-cheap-car-insurance-with-bad-credit\">best car insurance companies for people with bad credit,<\/a>\u00a0we compared rates from several insurers for an employed 30-year-old male driver in\u00a0<a data-lasso-id=\"5866\" href=\"https:\/\/web.archive.org\/web\/20210122122531\/https:\/\/quotewizard.com\/auto-insurance\/texas\">Texas\u00a0<\/a>with a 2012 Honda Accord LX. Our rate profiles have a clean driving record and includes 100\/300\/100 coverage. Credit scores were compared from ZIP codes throughout Texas.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Related Articles<\/h2>\n\n\n\n<p>We want to recommend to you some featured articles related to credit management, credit score, and debt settlement.<\/p>\n\n\n\n<p>We study which are the <a href=\"https:\/\/businessfinancenews.com\/credit\/credit-scoring-models\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6474\">credit scoring models available<\/a>, the <a href=\"https:\/\/businessfinancenews.com\/credit\/chapter-7-vs-chapter-13\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6475\">differences between chapter 7 and chapter 13 for bankruptcy<\/a>, an analysis of the application of <a href=\"https:\/\/businessfinancenews.com\/credit\/chapter-12-bankruptcy\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6476\">chapter 12<\/a>, <a href=\"https:\/\/businessfinancenews.com\/credit\/what-is-apr\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6477\">what is APR and how it is calculated<\/a>, <a href=\"https:\/\/businessfinancenews.com\/credit\/cant-pay-debt\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6478\">options available when you cannot pay your debt<\/a>, and the <a href=\"https:\/\/businessfinancenews.com\/credit\/debt-snowflake-method\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6479\">debt snowflake method<\/a>.<\/p>\n\n\n\n<p>We have reviews of <a href=\"https:\/\/businessfinancenews.com\/credit\/accredited-debt-relief-review\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6480\">Accredited Debt Relief<\/a> and <a href=\"https:\/\/businessfinancenews.com\/credit\/pacific-debt\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6481\">Pacific Debt<\/a>.<\/p>\n\n\n\n<p>We discuss <a href=\"https:\/\/businessfinancenews.com\/credit\/debt-consolidation-vs-credit-counseling\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6482\">debt consolidation vs credit counseling<\/a>, <a href=\"https:\/\/businessfinancenews.com\/credit\/secured-vs-unsecured-debt\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6483\">secured vs unsecured debt<\/a>, and <a href=\"https:\/\/businessfinancenews.com\/credit\/how-to-settle-credit-card-debt\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6484\">being sued by the debt collector<\/a>.<\/p>\n\n\n\n<p>We analyze if having a <a href=\"https:\/\/businessfinancenews.com\/credit\/does-corporate-card-affect-credit-score\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6485\">corporate card can affect credit score<\/a>, <a href=\"https:\/\/businessfinancenews.com\/credit\/how-to-settle-credit-card-debt\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6486\">how to settle credit card debt<\/a>, and we discuss if your <a href=\"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/\" target=\"_blank\" rel=\"noopener\" data-lasso-id=\"6487\">credit score has an influence on car insurance<\/a>. 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Insurance companies typically consider your credit score to set your auto insurance premiums. They use your credit score to determine your auto insurance score. The higher your &#8230; <a title=\"Does Credit Score Affect Car Insurance\" class=\"read-more\" href=\"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/\" aria-label=\"More on Does Credit Score Affect Car Insurance\">Read more<\/a><\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[44],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Does Credit Score Affect Car Insurance - Business Finance<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Does Credit Score Affect Car Insurance - Business Finance\" \/>\n<meta property=\"og:description\" content=\"How Does Credit Score Affect Car Insurance? 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Business Finance","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/","og_locale":"en_US","og_type":"article","og_title":"Does Credit Score Affect Car Insurance - Business Finance","og_description":"How Does Credit Score Affect Car Insurance? If you have bad credit, you&#8217;ll likely face higher than average car insurance rates. Find out how much higher, and why. Insurance companies typically consider your credit score to set your auto insurance premiums. They use your credit score to determine your auto insurance score. The higher your ... Read more","og_url":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/","og_site_name":"Business Finance","article_published_time":"2022-01-26T18:48:08+00:00","article_modified_time":"2023-08-24T15:19:05+00:00","og_image":[{"url":"https:\/\/web.archive.org\/web\/20210224175922im_\/https:\/\/quotewizard.com\/media\/4169\/car-insurance-credit-score.jpg"}],"author":"J Lipsky","twitter_card":"summary_large_image","twitter_misc":{"Written by":"J Lipsky","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/#article","isPartOf":{"@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/"},"author":{"name":"J Lipsky","@id":"https:\/\/businessfinancenews.com\/#\/schema\/person\/21ba6b6b8408bf78c37aea43c61d3d61"},"headline":"Does Credit Score Affect Car Insurance","datePublished":"2022-01-26T18:48:08+00:00","dateModified":"2023-08-24T15:19:05+00:00","mainEntityOfPage":{"@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/"},"wordCount":1056,"commentCount":0,"publisher":{"@id":"https:\/\/businessfinancenews.com\/#organization"},"articleSection":["Credit"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/","url":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/","name":"Does Credit Score Affect Car Insurance - Business Finance","isPartOf":{"@id":"https:\/\/businessfinancenews.com\/#website"},"datePublished":"2022-01-26T18:48:08+00:00","dateModified":"2023-08-24T15:19:05+00:00","breadcrumb":{"@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/businessfinancenews.com\/credit\/does-credit-score-affect-car-insurance\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/businessfinancenews.com\/"},{"@type":"ListItem","position":2,"name":"Credit","item":"https:\/\/businessfinancenews.com\/category\/credit\/"},{"@type":"ListItem","position":3,"name":"Does Credit Score Affect Car Insurance"}]},{"@type":"WebSite","@id":"https:\/\/businessfinancenews.com\/#website","url":"https:\/\/businessfinancenews.com\/","name":"Business Finance","description":"","publisher":{"@id":"https:\/\/businessfinancenews.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/businessfinancenews.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/businessfinancenews.com\/#organization","name":"Business Finance","url":"https:\/\/businessfinancenews.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/businessfinancenews.com\/#\/schema\/logo\/image\/","url":"https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/09\/2022-09-22_03-50-50.webp","contentUrl":"https:\/\/businessfinancenews.com\/wp-content\/uploads\/2022\/09\/2022-09-22_03-50-50.webp","width":451,"height":59,"caption":"Business Finance"},"image":{"@id":"https:\/\/businessfinancenews.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/businessfinancenews.com\/#\/schema\/person\/21ba6b6b8408bf78c37aea43c61d3d61","name":"J Lipsky","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/businessfinancenews.com\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/338dd21f6226446418ff37e1d0426ee2?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/338dd21f6226446418ff37e1d0426ee2?s=96&d=mm&r=g","caption":"J Lipsky"},"url":"https:\/\/businessfinancenews.com\/author\/lipsky\/"}]}},"taxonomy_info":{"category":[{"value":44,"label":"Credit"}]},"featured_image_src_large":false,"author_info":{"display_name":"J Lipsky","author_link":"https:\/\/businessfinancenews.com\/author\/lipsky\/"},"comment_info":0,"category_info":[{"term_id":44,"name":"Credit","slug":"credit","term_group":0,"term_taxonomy_id":44,"taxonomy":"category","description":"<div>\r\n\r\nCredit repair companies help you dispute inaccuracies on your reports with credit bureaus and creditors to help improve your credit score, while also helping you understand your credit standing. Since some credit situations are more complex than others, credit repair companies can help you resolve credit issues that would otherwise be hard to do on your own.\r\n\r\nCredit repair companies will start by pulling your credit reports from the three major credit bureaus\u2014TransUnion\u00ae, Experian\u00ae and Equifax\u00ae. Since some credit agencies only report to one credit bureau, there may be errors on one report that won\u2019t appear on another, which is why it\u2019s important for credit repair companies to pull all three.\r\n\r\nWhen reviewing your credit reports, credit repair companies will look for the following errors:\r\n<ul>\r\n \t<li>Incorrect inquiries<\/li>\r\n \t<li>Inaccurate accounts<\/li>\r\n \t<li>Accounts that don\u2019t belong to you<\/li>\r\n \t<li>Duplicate accounts<\/li>\r\n \t<li>Delinquencies and derogatory marks<\/li>\r\n \t<li>Fraudulent activity<\/li>\r\n \t<li>Missing accounts that should be listed on your reports<\/li>\r\n<\/ul>\r\nOnce they\u2019ve identified these errors, they may ask for extra documentation to help prove the inaccuracies. With all the necessary information, they\u2019ll file the disputes and work with the credit bureaus to resolve the issues.\r\n\r\nThese companies will also help answer any questions you may have about your credit and once the errors have been disputed, they\u2019ll provide you with information on strategies you can use to help keep a healthy credit profile.\r\n<h3><span id=\"How_to_know_if_a_credit_repair_company_is_legitimate\">How to know if a credit repair company is legitimate<\/span><\/h3>\r\nWhile there are many legitimate credit repair companies the industry is also filled with its fair share of scammers. Doing thorough research on the companies you\u2019re looking to work with can save you time and money. To verify a credit repair company\u2019s legitimacy, you\u2019ll need to know what they\u2019re legally allowed to do and not do.\r\n\r\nThe Credit Repair Organizations Act (CROA) was put into place to help regulate the industry and protect consumers from illegal credit repair scams. Under CROA, credit repair companies are not allowed to guarantee the removal of negative items, cannot offer to create a new credit profile for you and cannot accept payment until after the services have been completed.\r\n\r\nWhen determining good credit repair companies from bad ones, look out for the following red flags:\r\n<ul>\r\n \t<li><strong>They request payment up front.<\/strong>\u00a0All payments must be made after the services have been completed.<\/li>\r\n \t<li><strong>They\u2019re unable to answer your questions.<\/strong>\u00a0Legitimate companies will provide answers to any and all questions that may arise.<\/li>\r\n \t<li><strong>They ask you to lie about your credit history.<\/strong>\u00a0Under CROA, companies are prohibited from asking you to lie or misrepresent your information.<\/li>\r\n \t<li><strong>They fail to provide information.<\/strong>\u00a0Reputable companies will always inform you of your rights as a consumer.<\/li>\r\n<\/ul>\r\n<\/div>\r\n<div>\r\n<p class=\"after-tip\">Legitimate credit repair companies will be up front about how they can assist you and what services they think will work in your favor. They\u2019re here to help you understand your credit standing and want to work with you to improve your credit score.<\/p>\r\n\r\n<h3><span id=\"How_much_does_it_cost_to_repair_my_credit\">How much does it cost to repair my credit?<\/span><\/h3>\r\nHow much you pay for credit repair will depend on the company and your credit situation. Some consumers may only need a few errors disputed, while some may require more in-depth credit repair services. How you pay for these services vary from company to company, as each has its own payment structure. Some companies may require you to pay a one-time flat fee, pay per derogatory mark or charge a monthly payment.\r\n\r\nCredit repair companies cannot charge you until the work outlined in your contract is complete. The contract should also outline your right to cancel without penalty should you wish to do so.\r\n\r\n<\/div>\r\n<div>\r\n<p class=\"after-tip\">We offer a variety of service levels to support every budget and need. Our credit repair service levels range from $95.95 to $139.95 and each option offers unique coverage to fix errors on your credit report.<\/p>\r\n\r\n<\/div>","parent":0,"count":18,"filter":"raw","cat_ID":44,"category_count":18,"category_description":"<div>\r\n\r\nCredit repair companies help you dispute inaccuracies on your reports with credit bureaus and creditors to help improve your credit score, while also helping you understand your credit standing. Since some credit situations are more complex than others, credit repair companies can help you resolve credit issues that would otherwise be hard to do on your own.\r\n\r\nCredit repair companies will start by pulling your credit reports from the three major credit bureaus\u2014TransUnion\u00ae, Experian\u00ae and Equifax\u00ae. Since some credit agencies only report to one credit bureau, there may be errors on one report that won\u2019t appear on another, which is why it\u2019s important for credit repair companies to pull all three.\r\n\r\nWhen reviewing your credit reports, credit repair companies will look for the following errors:\r\n<ul>\r\n \t<li>Incorrect inquiries<\/li>\r\n \t<li>Inaccurate accounts<\/li>\r\n \t<li>Accounts that don\u2019t belong to you<\/li>\r\n \t<li>Duplicate accounts<\/li>\r\n \t<li>Delinquencies and derogatory marks<\/li>\r\n \t<li>Fraudulent activity<\/li>\r\n \t<li>Missing accounts that should be listed on your reports<\/li>\r\n<\/ul>\r\nOnce they\u2019ve identified these errors, they may ask for extra documentation to help prove the inaccuracies. With all the necessary information, they\u2019ll file the disputes and work with the credit bureaus to resolve the issues.\r\n\r\nThese companies will also help answer any questions you may have about your credit and once the errors have been disputed, they\u2019ll provide you with information on strategies you can use to help keep a healthy credit profile.\r\n<h3><span id=\"How_to_know_if_a_credit_repair_company_is_legitimate\">How to know if a credit repair company is legitimate<\/span><\/h3>\r\nWhile there are many legitimate credit repair companies the industry is also filled with its fair share of scammers. Doing thorough research on the companies you\u2019re looking to work with can save you time and money. To verify a credit repair company\u2019s legitimacy, you\u2019ll need to know what they\u2019re legally allowed to do and not do.\r\n\r\nThe Credit Repair Organizations Act (CROA) was put into place to help regulate the industry and protect consumers from illegal credit repair scams. Under CROA, credit repair companies are not allowed to guarantee the removal of negative items, cannot offer to create a new credit profile for you and cannot accept payment until after the services have been completed.\r\n\r\nWhen determining good credit repair companies from bad ones, look out for the following red flags:\r\n<ul>\r\n \t<li><strong>They request payment up front.<\/strong>\u00a0All payments must be made after the services have been completed.<\/li>\r\n \t<li><strong>They\u2019re unable to answer your questions.<\/strong>\u00a0Legitimate companies will provide answers to any and all questions that may arise.<\/li>\r\n \t<li><strong>They ask you to lie about your credit history.<\/strong>\u00a0Under CROA, companies are prohibited from asking you to lie or misrepresent your information.<\/li>\r\n \t<li><strong>They fail to provide information.<\/strong>\u00a0Reputable companies will always inform you of your rights as a consumer.<\/li>\r\n<\/ul>\r\n<\/div>\r\n<div>\r\n<p class=\"after-tip\">Legitimate credit repair companies will be up front about how they can assist you and what services they think will work in your favor. They\u2019re here to help you understand your credit standing and want to work with you to improve your credit score.<\/p>\r\n\r\n<h3><span id=\"How_much_does_it_cost_to_repair_my_credit\">How much does it cost to repair my credit?<\/span><\/h3>\r\nHow much you pay for credit repair will depend on the company and your credit situation. Some consumers may only need a few errors disputed, while some may require more in-depth credit repair services. How you pay for these services vary from company to company, as each has its own payment structure. Some companies may require you to pay a one-time flat fee, pay per derogatory mark or charge a monthly payment.\r\n\r\nCredit repair companies cannot charge you until the work outlined in your contract is complete. The contract should also outline your right to cancel without penalty should you wish to do so.\r\n\r\n<\/div>\r\n<div>\r\n<p class=\"after-tip\">We offer a variety of service levels to support every budget and need. Our credit repair service levels range from $95.95 to $139.95 and each option offers unique coverage to fix errors on your credit report.<\/p>\r\n\r\n<\/div>","cat_name":"Credit","category_nicename":"credit","category_parent":0}],"tag_info":false,"_links":{"self":[{"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/posts\/8625"}],"collection":[{"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/comments?post=8625"}],"version-history":[{"count":4,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/posts\/8625\/revisions"}],"predecessor-version":[{"id":25480,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/posts\/8625\/revisions\/25480"}],"wp:attachment":[{"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/media?parent=8625"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/categories?post=8625"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businessfinancenews.com\/wp-json\/wp\/v2\/tags?post=8625"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}