How to Recognize a Credit Repair Scam
You’ve probably seen the advertisements in newspapers, on Television, and on the web sites. You can hear them on the radio. You find the ads in your mail box, and maybe even cold calls during dinner, offering credit repair services. They always make these or similar claims:
“Credit problems? Not a problem!”
“We can remove all your bankruptcies, liens, judgments and bad loans from your credit file for good!”
We can erase bad credit, fast, legal and all guaranteed.
Get a new credit file overnight – all legal.
It is not too good to believe these claims: they are very often signs of a scam. Some professionals even state they have never seen a legitimate credit repair company trying to make those claims. The fact is there is often not a quick fix for credit and creditworthiness. You can actually improve your credit report legitimately, but it takes some time, a conscious effort, and also sticking to a personal debt repayment plan.
Here are some hints that should trigger red flags as they show a Credit Repair Scam
All the time, companies target uninformed consumers who have poor credit histories with promises to clean up their credit report so they can get a car loan, a home mortgage, insurance, or even a job once they pay them a fee for the service. The truth is, these companies cant deliver an improved credit report for you using the tactics they promote. No one can legally remove accurate, but negative information from your credit report. So after you hand them over thousands of dollars in fees, you are often left with the same credit report and someone else has your money.
If you encounter credit repair offers, here is how you can tell whether the firm that does it is crap:
The service organization does not tell you all your rights and what you can do for yourself to repair your credit for free.
The firm wants that you refrain from contacting or calling any of the three major national credit reporting agencies directly yourself.
The organization or individual suggests that you try to create a brand new or false credit identity – and then get a completely new credit report – by applying for an EIN number, so that you use that instead of your Social Security number.
The company wants you to pay for credit repair services that they supposedly want to deliver, before they provide you any services at all. Under what is called the the Credit Repair Organizations Act, companies that are offering to repair or improve your credit, are not allowed to ask for money up front. They have to wait until they have completely delivered the repair services they have advertised.
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