When I was going through the mortgage process, my broker recommended a credit repair company, whom I learned had three broad purposes (the reason I mention this

When I was going through the mortgage process, my broker recommended a credit repair company, whom I learned had three broad purposes (the reason I mention this is in point three): 1. Relieve the psychological / emotional stress of debt collectors hounding you by redirecting that to them. 2. Offering to settle debts. Realize, though that "Paid in full" and "Settled in full" are different statuses to a CRA. And both have an entirely negligible impact on improving your credit score - the damage is done when the negative tradeline is reported. HOWEVER, for mortgages, there's some merit in resolving this. "Yes, it got to that point, but I did take care of it" is better that "Yes, it got to that point, and then I continued to ignore it." 3. How do these agencies also "improve" your credit? They dispute every negative tradeline, regardless of accuracy. If the tradeline isn't verified (because smaller/more manual agencies don't have the time/inclination, especially if they've got their money now), it is removed, like it never happened. If it IS verified? They dispute it again. And again. In the hope that at some point the creditor will fail to meet the verification requirements. Nothing magic.