Credit Repair Scam

How many commercials have you seen or heard from companies claiming to be able to repair your credit?

Credit Repair ScamI suppose in our fast-food mentality society it just sounds so appealing to hand over your financial woes to someone or some company and have your years of bad decisions erased.  Unfortunately it’s not that easy. It never is.

But that doesn’t stop the scammers from making you believe that it is.  Here are some cold hard facts regarding credit repair:

1. If the information is accurate, it cannot be erased.  Incorrect information can be challenged, but accurate bad credit info stays on your credit report for 7 years.

2. Credit repair services are required by Federal law to explain your legal rights, via detailed written contract and can not ask for payment up front.  If they want money from you, before they fulfill their promise, it’s a scam.

3. Delete emails soliciting credit services.  Anyone can write good, convincing ad copy.  Doesn’t make them a reputable company.

4. You have the ability to correct mistakes on your credit report.  If you have been denied credit recently because of information on your credit report, you have the right to request a free credit report.  Some states also provide one free credit report per year.  Disputing items on your credit report is free.  Each of the three major reporting agencies have instructions on their websites or by phone:

Equifax, 800- 685-1111, www.equifax.com

Experian, 800-682-7654, www.experian.com

TransUnion, 800-916-8800,www.transunion.com

Contact all three, as the information each has may vary.

5. If there is a valid reason why you couldn’t pay our bills (illness, unemployment, disaster, etc.), include it on your report.  If it’s a legitimate reason or dispute give the credit bureau a statement to include.

6. Know that you can’t create a second credit file. Fraudulent companies at times offer to provide consumers with a new tax identification or social security number in order to create a new credit file. This practice, called “file segregation,” is illegal, and it doesn’t work.

7. If you have credit problems, get counseling. Your local Consumer Credit Counseling Service (CCCS) can provide advice about how to build a good credit record. The CCCS may also be able to make payment plans with your creditors if you’ve fallen behind. These services are offered for free or at a very low cost. To find the nearest CCCS office, call toll-free, 800-388-2227, or go to www.nfcc.org.

 

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