Want to uncover the secrets for fixing a bad credit score? OK. But before you make any move, stop and ask how much this miracle cure is going to cost you.
Should you really be spending $800, $900 or $1,000 on an education plan to clue you into credit-repair fixes? How could that add 100 points to your score anyway?
Or would hundreds of dollars really be better spent on paying down some of your debt?
"So many consumers can do this on their own," said Melanie A. Duquesnel, president and CEO of the Better Business Bureau serving eastern Michigan.
Credit-challenged consumers beware.
The Better Business Bureau is warning that complaints regarding credit-repair outfits are on the upswing nationally.
One huge gripe: People got zip for their money.
For example, the St. Louis Better Business Bureau said that 85 percent of the complaints that its office received on the issue indicated that consumers said they had received no services from the credit-repair companies, despite paying an average of $816.
Duquesnel said many consumers may want to believe the promises that they hear because they're desperate for a solution after the long recession.
"Some of us had not expected a rainy day to last almost two years," she said.
No one, of course, wants to throw good money after bad.
So if one has extra money, it's likely wiser to use that money to pay off debt and get a boost to credit scores by lowering your debt load, said Rachel Bell, senior director of global scores and analytics for FICO Labs.
Bell noted that consumers should understand that reaching a debt-settlement agreement with a creditor won't translate into a boost in scores.
The consumer could be in better financial shape because the lender agreed to take less money as part of a settlement. But the consumer still did not pay what was owed and that hurts a score, she said.
Credit-repair ads give the impression that somehow it's easy to erase negative information from a consumer's credit report.
A debt settlement is a strategy that involves trying to reduce a consumer's debts or monthly payments through negotiating with creditors.
The St. Louis Better Business Bureau noted that some consumers had plenty of complaints on some debt-settlement offers, too.
Those who complained paid an average of $2,000 for debt-settlement services, and half of those who complained said no services were provided by these companies.
A debt-settlement company often charges a monthly fee, which the company is supposed to use toward paying down the consumer's debt after negotiating lower outstanding balances with creditors, the BBB said.
One consumer paid $400 a month for four months with no indication of action on the part of the debt-settlement company, the BBB said. The debt-settlement company said negotiations would not begin until balances went into collections.
A stressed-out consumer might see a promotion on the Internet and think "Why not?"
"The ads often make people think there's a quick fix to their credit problems if they just know the tricks or secrets and pay for them," said Gerri Detweiler, personal finance expert for Credit.com.
What can a consumer do on his or her own?
First, go to annualcreditreport.com to receive a free credit report and see whether there are any mistakes to dispute.
You can't clean it up if you don't know what is causing trouble, said Dorothy Barrick, group manager and financial counselor for GreenPath Debt Solutions, a nonprofit credit-counseling company based in Farmington Hills.
One report by the Federal Reserve noted that unpaid medical bills make up most of the collection actions on credit reports. And many of those unpaid bills are for less than $250.
Some people don't even know there was an issue because they thought their insurance company took care of the bill.
Barrick recommends paying off any small amounts that were turned over to collection agencies, too. If you know you owed $20 for an unpaid bill, pay it, she said.
Other factors can apply, so there are no guarantees that this would help your score.
"Just owing a collection agency is not a good thing," Barrick said.
And you can dispute the issue with the credit-reporting agency if the debt is wrong. Or you can explain if it's an issue of nonpayment by an insurer.
The impact of an unknown collection action can drive up the interest rate you'd get for a car loan or a mortgage.
Even so, keep in mind: Pay your bills on time, don't borrow more money and maintain relationships with card issuers.
And avoid gimmicks.
You do not want to get into some sort of plan where a stranger or friend would agree for a fee to add you as an approved user on their credit account. What if that person doesn't have good credit? On top of that, it's not an honest move.
Detweiler of Credit.com said it may not be a bad idea, though, if you have a spouse with credit in good standing and a low balance to have him or her add you to a credit card as a joint account holder to help boost your score.
Like losing weight, some ways to fix your credit are slow and downright boring. But little by little, you can get the job done.