Is 'rapid re-scoring' better than long-term credit restoration?

Mortgage companies use 'rapid rescore' to quickly boost FICO scores.


"We've never seen a legitimate credit repair operation" is the quote I read in bold large type on a website called Credit technologies, Inc. (credittechnologies.com). The website was quoting C.Steven Baker, who is the Director of the Federal Trade Commission's Chicago Regional office.  Honestly, when I saw that quote I was a little shocked and offended.  First, let me say a little something about credit technologies, Inc.  The company was founded in 1990 by Thomas Conwell III.  Their official business listing is a 'consumer reporting agency'.  They actually offer an impressive array of services including: credit reporting, credit re-scoring, automated credit analysis, and access to many types of public records.  According to their website they also offer mortgage, Realtor referral services. 
Only after reading through the 'Services' page of their website did I realize why they used that quote from Mr. Baker.  Their main service is rapid re-scoring of credit files which basically entails the same type of work credit repair companies do, except they claim to do it faster and better.  After more research, I found that while there are less of that type of company than there are credit repair agencies, the same warnings should apply to them: watch out for the scammers!

This company (Credit technologies, Inc.) claims that a consumer can get their credit report rapidly re-scored without providing any documentation.  If you read the article that I reference below in this post, you will see this type of service is regulated by the same laws (CROA) as credit repair companies.  That means they ultimately must  operate by the same rules.  The main rule to which I am referring is section 611 of the Fair Credit Reporting Act (FCRA) - duties of furnishers upon receiving dispute from a consumer. While the turn-around time is faster because of the contractual relationship between the credit reporting agency and the mortgage company, the responsibilities of the consumer disputing the information are the same: they must provide documentation that indicates proof that the information contained in the credit file is either, wrong, erroneous, or incomplete.  If the consumer cannot provide that proof, it does not matter how fast the turn-around time is, the information will be verified by the original creditor and the consumer's FICO score is not going to change.

Now I would like to put some context around that startling statement from Mr. Baker.  It just so happens that I was doing some internet surfing looking for information on the Credit Repair organizations Act and found a news article from 2010 indicating 9 Chicago area credit repair agencies were indicted and sued by the FTC for fraud and deceptive practices.  On top of that, most of the agencies that were sued were not even registered with the State of Illinois to be doing business.  They had no Illinois state business licenses!  It's no secret that there are a lot of so-called credit repair companies that commit fraud in order to deceive their clients.  The nature of credit repair itself makes it easy for someone to put up a website, and claim that they can clean up someone's credit when they know next to nothing about consumer protection laws. 

Credit repair, at its core,  is simply the act of telling a credit repository (better known as credit reporting agencies) either in writing or on the phone that you don't agree with something in your credit file.  That's it.  It has been my experience, along with finding tons of empirical evidence from organizations like the creditinfocenter and  National Consumer Law Center that the credit repositories are the ones who complicated things by not being responsible with our private financial information.  So I would beg to differ with Mr. Baker.  Maybe he's never seen a legitimate credit repair agency in Chicago and other places under his jurisdiction, but I know of several legit credit repair agencies personally, including the one I own and operate.

What  is Rapid Re-scoring?

Rapid re-scoring is a service that is exclusive to mortgage companies, Brokers, and Realtors who contract with the 'big three" credit bureaus on behalf of their clients who want to raise their FICO score in order to qualify for a loan or a better interest rate on a loan.  The service is not available to the general public and costs about $30.00 per tradeline.  The basic process is the same for each credit provider.  Once a tradeline has been identified, an updated statement or letter from the account holder is obtained.  Paperwork from the credit provider is filled out and returned along with the proof of change to the account.  The credit provider researches and verifies the validity of the update and adjusts the score based on the updated information.  The credit provider then notifies the lender of the change. This entire process can take little more than a few days.  For a more details on how rapid re scoring works visit this site.

Is rapid re-scoring better than traditional credit repair?

It depends.  Assuming both the credit repair company and the rapid re-scoring company are legit and do good work, it really depends upon which type of tradeline you are dealing with, and how fast you want the tradeline(s) investigated, and whether you have documentation that can prove the tradeline is erroneous or incorrect.  For a list of the types of tradelines eligible for rapid re-scoring please see the website I referenced above.  If you are only 20-30 points from a certain score and you are well into the process of buying a home, I would go with a rapid re-score.  If you are six months out and just have started looking to buy a home, I would definitely go with a reputable credit repair agency.

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