Credit Cards Credit Repair

Warning Signs of Credit Repair Rip-offs 

Written by Shelly Evans

“Your credit will be erased permanently!”; Does that offer sound too enticing to dismiss? Maybe so. Especially Danger Fraud Alertfor those who are awfully troubled by financial crisis and debt. They may be so desperate about their bad credit that they would take any offer of help as appealing as that. But before you take that plunge, be warned! There are many companies out there, disguising as help who are only after your money.

Here are the warning signs of what to look out for or credit repair rip-offs:

  • You are being asked to pay a sum of money before any services are provided. This should be a major red flag for you, because you are already in debt and you should be not be asked to put out any sum of money without completing the services you need.
  • The Company does not advise you your legal rights.
  • You are not informed about options that you can do for yourself for free. Yes, there are some means to help fix your credit problems on your own, without having to pay anything.
  • Advises you not to get in touch with a credit bureau directly.
  • Advises to use false information such as your Employer Identification Number to use in place of your Social Security Number
  • Recommends an action that seems illegal like creating a new credit identity. Following this advice will make

Remember, it is a federal offense to use false statements on a loan or credit application.

Under the Credit Repair Organizations Act, credit repair companies cannot require payment from the client until they have accomplished their services. If the company promises to clear out negative information about your credit, that is a lie. You can only request a re-investigation of the information in your file that you dispute as inaccurate or inexact. You can even do so by yourself for free or if not, this could be done by the Credit Repair Company at a low charge. According to the Fair Credit Reporting Act, you can also get a copy of your credit report and dispute mistakes on your report free of charge.

True, many Credit Repair Companies make ridiculous offers and knowing what these are is a great protection that would save us time, money and false anticipation. There is legitimate Credit Counseling Companies that one can obtain help from. And these ones explain to you your rights and give you all necessary steps that you can do to break away from bad credit. So go ahead, feel free to avail their service, but make sure you will be getting the right one.

For a copy of your report, you may contact one of the following numbers:

Experien (formerly TRW) at (800) 682-7654

Equifax at (800) 685-1111;

Trans Union at (800) 916-8800.

If you have been charged money by a Credit Repair Company with a promise to fix your credit, you may file a complaint with the FTC at (202) FTC-HELP, TDD (202) 326-2502. You may ask for free information on credit repair and other consumer issues from the Federal Trade Commission at these same numbers.

 

Sign up for our mailing list to get a FREE CREDIT REPAIR GUIDE

About the author

Shelly Evans

Shelly Evans is a freelance writer and loan consultant. She specialize in writing articles about obtaining financing despite having bad credit. She has more than 16 years in consumer credit and collections and 4 years in business financing.

4 Comments

  • Very good information everyone needs to read. There are a lot of scummy credit companies out there that don’t care to give you money because they end up kicking you right into debt. The problem with this is, you either pay them off or your credit suffers. I am not sure if this is still true, but any amount of debt lasts 7 years. If you have a card that lowers your credit scores, even if you pay them off, the damage lasts for 7 years. If that is true, all the more reason to be careful.

  • Hi Britanica,

    Thanks for visiting the site! Yes it is true. Negative information will stay on your credit report of 7 years. In some cases a bankruptcy can be on there for 10 years. And one of the quickest ways to end up drowning in debt, is over using your credit cards.

    Alot of fake credit repair companies do nothing but send out a lot of letters claiming the information being reported is wrong. They don’t do anything to help the client learn better financial habits. They rarely even get anything removed from their clients credit reports, but if you read the fine print on their contracts…they don’t guarantee results! So people really need to watch out!

  • I have been down this road and it was not a pretty ending. I have been rebuilding my credit since then for the last 10 years. Good warnings for people!

  • These are good warning signs for sure. I used to work for a company that did a service like this. There were only a few cases that ended in a good way. The rest did not keep up with payments and were in worse shape than they started.

Leave a Comment