I wanted to write a bit about cost. Cost of bad credit, cost of credit repair and whether it's worth it.
As the adage says, very little in life is free. Love, Death (sometimes) and if we're lucky, we get a few free lessons once and a while but generally, very little is actually free.
Likewise, there's a lot of stuff out there that costs money. If we are lucky, that cost is commensurate with the return. Otherwise knows as return on investment (ROI). One of the first things I do, when I review a credit report with someone is take a look at any auto/installment loans they may have. I do a simple thing: I multiply the monthly payment, by the number of months and come up with the true cost of the vehicle. Then I subtract this number, from the 'high balance', or what they paid for the vehicle. The difference difference between the two is how much interest we are paying.
Many... way too many times, this number is over $5000.00. A lot of times, the number is over $10,000.00. There is no reason why any of us should be paying $10,000.00 in interest or more for a vehicle that we bought for $25,000 which is about the average cost of a car nowadays.
So, for many of us who are considering credit repair we struggle with the cost of it. Is it worth it? That is something you have to determine for yourselves. Also, you can do this one your own!!.
We at Credit Dr. do not push. We are educators in this process. However, I do find it helpful to compare. Case in point, if we are paying an extra $200.00 a month in interest for 72 months... is Credit Repair really that expensive? If the goal is to fix the credit so long term we are no longer paying exorbitant interest rates, or because we can now qualify for a home, or live a bit safer, isn't it worth it? The average price of a TV now a days is $400.00. Many of us pay that with out second thought.
Heck, my cell phone bill is almost $200.00 a month. My mother pays over $200.00 a month for cable, TV, and phone. Every month!!
I guess what I am saying is... if we can invest $1000.00 or $1,500.00 in having better credit. And not paying $200.00/month for 72 month... doesn't that make sense?
We are paying for bad credit one way or another. Whether it's hidden in our interest rates, or spent on an endeavor to improve things. Either way, bad credit costs money. And often times way more than going with a credit repair organization, or doing it on your own. Death by a thousand cuts.
Ed-Jack Dvorak is National Affiliate Liaison at Credit Dr., a national credit restoration company. He works with clients and creditors to improve credit profiles.