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Beware of Bogus Credit Repair Companies!
So-called "credit repair" companies claim they can remove
negative information from credit reports. Advertising as "Credit
Advisors," "Credit Rating Correction Services" or "Credit
Consultants," they trumpet variations on this message: "Turned
down because of bad credit? We can help!" Many of these companies
charge hundreds if not thousands of dollars for the promise to
"clean up" bad credit reports. But the truth is, these companies
can only do what you could do yourself--at no charge.
Nobody can remove negative information that is accurate from
your credit report. No company has a "secret" ability to remove
all negative information.
But this doesn't stop their claims. This deceptive quote is
from a credit repair company brochure: "Charged-off accounts,
collection accounts, judgments, tax liens, repossessions, and
even bankruptcies can be removed from your credit records in less
than one year (five to seven month average)."
One tactic is to bombard credit reporting agencies with
requests to verify information. If a credit reporting agency
cannot verify an entry within 60 days, it will remove the
information from the report. But if the information is later
verified to be accurate, it will go back in the report.
Before you even consider signing a contract with a company
that promises to repair your credit, remember these facts:
- You may obtain a copy of your credit report on your
own.
- You have the right to dispute entries in your credit
report.
Beware guaranteed credit offers!
Credit repair and other companies often claim they "guarantee"
to get you a credit card, regardless of your credit history. In
fact, these companies do not always honor their guarantee.
Sometimes, they'll just take your money and run--you will not get
any credit, regardless of what they promised.
If they get you a card at all it often will be a "secured"
bank credit card, with high up-front "application" fees, that
requires you to deposit and keep several hundred dollars in a
savings account, or a card that only allows you to buy items in a
catalogue from a business that you probably never heard of. (You
can apply for a secured credit card by yourself. For a free list
of banks that do not charge application fees for secured cards,
see the information from Consumer Action in the "For More
Information" section below.)
Credit repair companies often advertise on television, in
newspapers and even on matchbooks. Sometimes they require
consumers to dial a "900" telephone number to get more
information. Calls to 900 numbers can cost $2 or $3 a minute, so
listening to a few minutes of information about the cards can be
expensive.
Some companies try to get people a credit card by having them
apply using financial information of other people with good
credit histories. It is a criminal act to apply for credit under
someone else's name--do not do business with one of these
companies.
Law enforcement agencies have shut down many credit repair
outfits, but it is hard to stop a fraudulent credit repair outfit
unless people complain about it. Therefore, be careful about
responding to credit repair ads and be sure to complain to the
agencies listed below if you think a credit repair company took
advantage of you.
For more information
- The Federal Trade Commission (FTC) publishes information
for consumers on the subject of credit and enforces federal
laws on credit. For a list of free publications, write to the
FTC's Public Reference Department at the address given below.
While the FTC does not handle individual cases, it can act when
it sees a pattern of possible law violations develop.
Complaints about credit reporting agencies and credit repair
scams must be in writing. Send them to: FTC Credit Practices
Division, 6th St., N.W., Washington, DC 20580.
- Contact your local consumer protection agency or your state
Attorney General's office. Many Attorneys General have
toll-free consumer hotlines. These numbers may be listed in the
"self-help" or government sections in the front of your phone
book. These agencies can offer you advice and may also be able
to help resolve your complaint.
- Consumer Action's free complaint/information switchboards
offering non-legal consumer advice and referrals can be reached
from 10 a.m. to 2 p.m. on weekdays. Chinese, English and
Spanish are spoken. Call either (415) 777-9635 (San Francisco
office) or (213) 624-8327 (Los Angeles office). Consumer Action
has a free list of secured credit card banks that do not charge
application fees. To receive a free copy, send a self-addressed
stamped envelope to: Consumer Action Secured Credit Card
Survey, 717 Market St., Suite 310, San Francisco, CA 94103.
(Available in English only.)
- The Consumer Credit Counseling Service (CCCS) assists
consumers who have problems in paying their bills--before their
good credit ratings suffer. Your local CCCS office can help you
work out flexible payment plans to make debt repayment more
feasible. Call (800) 388-CCCS for an interactive recording that
will provide you with the phone number of the office nearest to
you. Spanish-speakers can call (800) 68-AYUDA (800-682-9832)
between 8 a.m. and 7 p.m. central time.
- Before you sign a contract with any company, check it out
with the local Better Business Bureau (BBB), a non-government
service which advises consumers on fraud prevention. Call your
local BBB. If you cannot find a local number listed in the
phone directory, call the Council of Better Business Bureaus at
(703) 276-0100 for a referral to the office nearest you.
About The Author
© Copyright. http://www.deleteuglycredit.com
Omar M. Omar is the owner of http://www.deleteuglycredit.com. The website is
dedicated to provide credit consumers with information about
their credit right and how to dispute inaccurate information on
their credit report. Omar M. Omar is also the author Of "The
Credit Repair Bible" book.
You have permission to publish this article electronically or
in print, in your Newsletter, on your website, or in your E-Book,
as long as the author's Resource Box is included with the
article.
omar@deleteuglycredit.com
MORE RESOURCES:
MORE COLLEGE CREDITChicago Sun-Times, United States - 10 hours agoDespite the current nationwide credit crunch, the State of Illinois secured $100 million for the student loans by tapping a new source -- credit unions. ... |
Ask, and you might receive a lower credit-card rateSeattle Times, United States - 13 minutes agoPick up the phone, look at the latest credit-card offers and keep repeating this: The bank needs me more than I need it. By Susan Tompor Pick up the phone, ... |
Boston Globe |
US travelers face credit snafuBoston Globe, United States - 11 minutes agoBy Eric Lucas All I wanted to do was buy gas, so I put my credit card in the automatic card-reader and got ready to fill the tank. ... |
Credit - Google News
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