Monday, 9 March 2015

Credit Repair Scams

Credit repair scams target worried or desperate consumers who want to believe they can restore their good names. Indeed, there are ways to improve credit scores, but they take time, reliability, and effort. Paying a large fee to a third party will never accomplish any benefit. Imagine finally being able to buy that new car, get debt collectors off your back, and enjoy a new found freedom from your past debts.

Sound to good to be true ?  It probably is.  Once you fall prey to the credit repair offer and pay the hefty fees involved to clean up your record, here’s what happens:

1) The credit repair scam artist contacts the credit bureaus and reports that the negative information in your file is false.

2) The credit bureau removes this negative information from your report while they investigate the claim.

3) The scam artist will then show you the cleaned up version of your credit report and “ta-da”  your credit history has been fixed !

But here’s what the scammer doesn’t tell or show you.  After the credit bureau completes their investigation the negative information is placed back on your credit report.

Negative but accurate information cannot be removed from your credit profile.  Only incorrect information can be removed.

Accurate information remains on your credit file for a period of 7 years from the time it is reported to the credit agencies;  a bankruptcy appears for a 10 year period.

Many legitimate companies exist that can help you with your debt problems.  But how do you spot a scam offer ?  Easy, they’ll ask you for their fees up front.  By law, credit repair agencies cannot ask for payment until they’ve provided the service they promised.

Additionally many states require that a credit repair service, whether they are for-profit or not-for-profit, must provide you with a detailed written contract, an explanation of your legal rights, and the opportunity to cancel any signed contract within 3 days.

Also, be aware that a “credit repair offer” could be an attempt to steal your identity by getting you to provide personal information such as a Social Security number, bank account and credit card account numbers.

Always make sure you know who you are dealing with before accepting any offer to help you repair your credit.  Those who don’t can have their credit ruined further and create more debt problems.

Avoiding credit repair scams is easy.  All it takes is a thorough internet search and careful reading of what the credit repair company has to offer. The moment you see that there is some form of guarantee that your credit repair can be fixed overnight, you should think twice. Remember, credit repair can never be done in a jiffy. It will always take time and patience. A legitimate credit repair company will tell you straight away that credit repair is and will never be an overnight process--there is no miracle cure for poor credit.

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