Watch Out For Credit Repair Scams
You’ve heard all the advertisements on the radio, seen the ads in the newspaper, on TV, and perhaps even received the fliers. One credit repair service or another is always promising impossible things. ‘We can erase your bad credit, 100% guaranteed!’ ‘We can remove bankruptcies, liens and bad loans from your credit forever!’
Unfortunately for consumers, any companies making these claims are out to take your money, because these claims are not only illegal, they’re pretty much impossible. In fact, attorneys at the nation’s consumer protection agency have never seen a legitimate credit repair company make these promises. The only true way to credit repair is with time, effort, and the repayment of debts.
Credit repair scams are targeting consumers every day. They go after those with poor credit histories, playing on their need to get approved for a loan. Not only can these companies not deliver on their promises, but it’d be illegal to do so! Legally, you cannot get accurate credit information removed from your history - negative or otherwise.
Yet everyday hundreds of people across the nation fall for these offers. It’s not surprising, considering these too good to be too credit repair offers can sound pretty legitimate. The federal government has released several tips on how to recognize fraud companies.
One big sign of a scam from a credit repair company is all about the cash. If they ask you to pay up front, before any services are rendered, be careful. Under the Credit Repair Organizations Act, these companies cannot require you to pay until the services they promised are completed.
Under federal law, you have certain rights regarding your credit history, and any legitimate company will inform you of these rights. A good credit repair service will even let you know what you can do for free to help repair your credit. Be especially careful if a company goes so far as to tell you not to contact the three national credit reporting agencies yourself.
Finally, if a company tells you they can remove most or all negative credit information from your report, even if that info is accurate, they’re wrong. And suggesting illegal credit repair. Another issue some of these scam services promote is the invention of a new credit identity, or the act of disputing all information on your report regardless of accuracy. All these tactics are indicators of a scam.
Not only do these tactics have no basis in credit repair, they can actually get you in hot water with the government! Most are considered fraud under federal law. The only way to truly repair your credit is to sit down with a legitimate company to work out a legal credit repair plan. It may take time and effort, but in the end it’s the only way to go.