Can Identity Theft Repair Companies Really Help?

With ID theft on the rise, so-called "identity theft repair companies" are becoming fairly common. But are they worth trying?

With 9 million new cases of identity theft reported each year, it was inevitable that specialized identity theft repair companies would soon appear to offer their services to the victims. While the help doesn't come cheap, to those traumatized by ID theft, their services can seem well worth the price. But are they really?

Let's take a closer look.

Hours and Hours

Before we get to the nitty-gritty, let's look at a few statistics.

According to recent figures, victims of identity theft spend an average of $1,200 and 600 hours on credit repair and clearing their names -- insofar as that's possible. The $1,200 is bad enough; add in all those hours when you could be doing something profitable, and you're deep in debt, through no fault of your own.

Instead of putting in all those hours and dealing with all those bureaucrats yourself, wouldn't you prefer to pay someone else that chunk of money to take care of it all for you? Some businesses claim that they can relieve you of the hassle, for a decent price that won't exceed the average quoted above.

Get the Facts Straight

First of all, realize that no ID repair company is going to be able to relieve you of every bit of the stress, pain, and time necessary to clean up your credit. Avoid companies that promise you otherwise: they're trying to mislead you. A good credit repair company will, however, do most of the work.

This means more than just cleaning up your credit. In addition to dealing with creditors and credit bureaucracies for you, top-notch companies like Kroll Fraud Solutions (probably the premier business in the industry) search for activity in a variety of places most consumers don't know about or simply can't get to.

Non-Credit Components

By the time you realize someone's stolen your identity, they may have done much more than monetary damage: they may have gotten you in trouble with local, state, and federal criminal justice systems, the DMV, Social Security, the Postal Service, and more.

So before trusting your identity recovery to a company, find out how deep their investigations go. At the least, they need to check with all the above agencies in their efforts to clear your name, and preferably others, especially if the fraud perpetrated in your name was widespread.

The Bottom Line

Given the incredible cost in time and money typically required to repair your own credit, it can be well worth the price to hire someone to help you. But don't expect them to do everything, and vet all identity theft repair companies carefully before choosing one to help you recover your credit -- and your good name.

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