Credit Repair Scams

Tuesday, November 2, 2010

Desperate times bring out scam artists. People all over the country are finding themselves in credit trouble. Loans are being denied because of bad credit reports. Interest rates are going up because of low credit scores.

People are becoming more aware of the need to improve their credit reports, which is a good thing. The more knowledge we have about our credit and how it is effecting us the better. However, scam artists are watching this hot topic. They know people are needing help and are ready to take the necessary steps to get that help. What they also know is just how to grab people in need and scam them out of their money. Yes, finding a person with financial problems and making those problems worse.

It is happening every day. It is especially happening on the internet. A person is ready to find someone to help them out of a bad credit situation. What do you do? Type into Google, or some other search engine, a phrase like 'fix bad credit'. Thousands of sites come up. BE CAREFUL!

There are many people out there that do want to help. The internet has great resources on it. But there are a few bad apples in the mix. Some of them are very clever. They hide themselves well. They are hard to recognize.
Here are a few tips to identify a possible credit repair scam:

• no one can erase information from your credit report that is true.
• only the credit bureau or the creditor may remove an item from your report.
• credit repair services are not allowed to take your money until they have done what they promised you.
• It is illegal to create a new credit file in the form of a second social security number or federal employer identification number for use on applications.
• there are no 'loopholes' or secrets to fixing bad credit.
• credit repair companies must offer you a written contract and give you 3 days after you sign it to cancel it at no charge.

If you reach out for help with your bad credit and any of the above come up in your search you need to stop interacting with that site or company (especially if you called them on a 900 number!!!)

If you are in over your head there are credit counselors that can offer you good advice. Your local Consumer Credit Counseling Service (CCCS) is a good place to start. Their services are offered for free or at a very low cost. Go to www.nfcc.org to find one near you.

If things aren't all that bad for you there are actions you can take for yourself. Some good first steps are to obtain your credit report, find any false information and then dispute any false information. Go to http://www.ftc.gov/bcp/menus/consumer/credit.shtm for more information.