Looking for a way out of credit purgatory? Who you gonna call for help?

If you’re exiting 2020 deeper in debt and with a tattered credit score, you are not alone. No doubt your mission in the new year is to find your way back from credit purgatory. The question though, is do you DIY or hire a credit repair company to take the problem out of your hands?

The experts weigh in. You decide what’s best for you.

The pros

"They have the knowledge and resources needed to deal with your issues effectively and efficiently. They also have experience negotiating with banks and lenders. They usually get results sooner than you could," says Joshua Zimmelman, president of Westwood Tax & Consulting in Rockville Centre.

Quicker results may mean you invest less financially to achieve the results you want, says Jake Hill, CEO of DebtHammer.org, an online personal finance site. He says they have connections, "They can put you in touch with debt consolidation options to pay down debt quickly and raise your score."

The main benefit Adem Selita, co-founder of The Debt Relief Company in Manhattan, sees from hiring a company is the fact that they are knowledgeable about the many laws and regulations regarding credit repair that most people won’t have time to properly research.

Their knowledge can bolster the success of your claims, says Drew Cheneler, founder of SimpleMoneyLyfe, a credit repair blog.

The cons

Despite those advantages there are downsides. While they may save you money in the long run, if you’re already struggling to pay off your debts it might be difficult to afford a repair company. "Hiring a credit repair company typically runs $50 to $100 a month depending on how much work they are doing for you," says Brian Edmondson, founder of Bankruptcy Recovery Foundation, in Levittown, Pennsylvania.

Avoid companies that have front loaded pricing and fees and ideally you should not pay fees until they resolve or improve your credit disputes, Selita says.

If you don’t plan on utilizing your credit in the short term, credit repair may not be the best way to spend your money right now, he adds.

Then there’s the issue of control. "The company will give you instructions to follow regarding your spending and saving and you’ll need to do what they tell you if you want them to successfully repair your credit," Zimmelman says.

They don’t have magic powers. "Credit repair companies cannot provide you with a guaranteed credit score improvement. For the most part, credit repair is hit or miss. Sometimes, the services rendered are successful, but sometimes they are not," Selita says.

Truth is, you can do much of what they do. For example, you can negotiate with your creditors for a lower interest rate, get a free copy of your credit reports, and dispute any incorrect information, points out Jeff Rose, founder of GoodFinancialCents.com. You can apply for a secured credit card and get back into creditors' good graces by making timely payments.

Consider a credit builder loan. Apps like Self offer credit builder loans that help you improve your credit on your own. "It’s like a hybrid between doing it yourself and hiring a company. Instead of getting money upfront, you make small monthly payments to yourself over the course of one to two years and Self reports those on-time payments and balance to all the credit bureaus," explains consumer advocate Andrea Woroch of Bakersfield, California.

At the end of the term, the money you've paid monthly unlocks in the form of savings, less any fees, while improving your credit score. You’ll see improvements soon because on-time payments play an important role in your overall credit score.