Credit Repair Scams

Credit repair scams prey on people who are sinking under huge debt and can’t seem to get out. When the debt seems so insurmountable that no reasonable course of action is able to help, then a company claiming to be able to repair your credit report, erase bad credit and establish new credit can seem like the only light at the end of the debt tunnel. Unfortunately, there are those out there who would make a person’s debt problem even worse in order to make illegal profits, so many of the companies who claim to be able to make your debt troubles disappear are operating credit repair scams.
How to Avoid Credit Repair Scams

If you’re in debt and having credit problems, talk to a lawyer about steps you should take to start paying down your debt and repairing your credit that way.  A financial planner or accountant may be able to offer further help and advice.  But any company that claims to be able to get rid of your bad credit rating or eliminate your credit problems for a fee is to be avoided.

No one can remove accurate information from your credit report.  And you can challenge inaccurate information yourself by contacting the credit reporting agency in writing, without paying anyone a fee to do so. How do you know if the company is operating a credit repair scam?  Claiming to erase your bad credit for a fee is the first dead giveaway.  Other signs include:

• Requiring an up-front fee for future services
• Little explanation about your rights
• They discourage you from contacting a credit bureau yourself
• They suggest you can obtain a new credit identity (you can’t)
• They suggest that you dispute your entire credit record, including accurate information

How You’re Put at Risk

Not only do companies like this take your fee and do absolutely nothing for you, you can even be charged with fraud if you follow illegal advice from such a company.  Trying to obtain a new credit identity often involves applying for an Employer Identification Number that the company might encourage you to use instead of your Social Security number.  This is fraud, and can land you in legal trouble.

A credit repair company cannot require you to pay before services have been completed, or a three-day waiting period has passed after you have signed the contract, during which you can cancel it without paying fees.

Legal Credit Repair

If you believe information on your credit repair is a mistake, you can purchase the services of a credit repair agency that claims to be able to remove such inaccurate information.  In that case, the fee should be made clear up front, exactly what they’ll do should be made clear, and a timeline for results should be laid out.

But you can repair your credit report yourself, by requesting a copy of your credit report from the credit bureau and challenging any inaccurate information. As your lawyer for advice on how to proceed if you’re unsure.

Have you fallen victim to bankruptcy? Contact a Bankruptcy Attorney today!