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Credit Restoration vs. Credit Counseling

Apr 12, 2008
One must not confuse credit counseling with credit restoration since both are different. While the former helps you in eliminating erroneous information from your credit report so as to increase your credit score; the latter will let you know about the ways on securing a good credit score by making wise decisions about your purchasing habits.

Apart from other things, you also need to learn the art of using a budget intelligibly. The only difference is that some people are better at following a budget while others are not and thus are able to secure a good credit score.

Simply by managing your debts right, you can have an excellent credit score. But if you are unable to do this, the result will be opposite and you will notice a drop in your credit score and will need some credit restoration or file for bankruptcy.

One way to succeed with credit restoration is to keep moving slowly towards rebuilding your credit score back to its previous level. However, you will need the help of a financial expert to achieve this objective and here is were credit counseling comes in.

More often than not, credit counseling is done by legitimate non-profit agencies. Here is a word of caution for you: Do not confuse credit counseling agencies with credit restoration agencies. The major difference between credit counseling agencies and credit restoration companies is that while the credit counselors will provide you with information and knowledge regarding a DIY (do-it-yourself) credit fix; the credit restoration companies will perform most of your work on your behalf and unlike non-profit credit counseling, you need to pay for these services.

So, if you opt for a credit restoration company, then make sure that you choose a reputable one that has good experience in this field and also has a record of customers to verify the record. Additionally, make sure that the company that is wiling to work for you is making a serious effort to eliminate erroneous items on your credit report.

Do not try to adopt any shortcut here. If they suggested any kind of illegitimate process such as getting a new credit file and making a new credit rating; simply turn down the proposal as the company you are seeking help from may be a scam!

On the other hand, if you seek credit counseling, here you will be advised on how to fix your credit report on your own. The biggest advantage of taking help from a credit counselor is that since you will make an attempt to restore your credit report on your own; you will learn lots of things regarding financial responsibilities as well as finances in general.

So, by choosing credit counseling over a credit restoration company, you would gain a number of benefits that otherwise you wouldn't. On the other hand, credit restoration is a long term process; so it is probable that you will not find yourself in financial trouble caused by reckless spending again in future.
About the Author
J Delgado is an expert in helping individuals restore there credit. To find out more about having foreclosures, bankruptcies, late payments and other derogatory items removed from your credit report contact him at creditexpert@scrupyourcredit.com or at: http://www.scrupyourcredit.com
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