Credit Repair Scams – Do Your Homework

I’m sure you’ve heard stories about those who go to credit repair companies for assistance to improve their credit score, only to fall prey to credit repair scams. So that you can understand what you need to do to avoid being taken in by such unscrupulous people|these scammers|these crooks}, you must be aware of how they function.

They’re betting that people who find themselves over their heads in debt are in such desperation as to grasp at anything that is told them, hoping these fraudulent companies are really able to lead them out of financial despair, so they can get their lives back. They in many cases are so disheartened by the system, which is downright cruel to people who have problem credit, that they’ll do anything whatsoever to get it fixed.

Most people who seek out help are thinking about declaring bankruptcy. It is these who are most likely to fall prey to credit repair scams.

Why is this? Because they want fast results, and don’t realize that solving their credit problems can take up to 12 months. Very often, they feel that they don’t have much time, and unless they act quickly, it will be too late. Ironically, when they sign up with such unscrupulous agencies rather than ridding themselves of debt, they will find themselves in even worse financial straits, since they’ve been chasing a mirage.

Here are some red flags so you can avoid credit repair scams:

1. They promise the impossible – lots of these agencies promise to get every negative trade line deleted from your credit report. They will also guarantee that your score will increase within the next 2-3 months.

They try to accomplish this by disputing every negative trade line in your report. The bureaus may initially remove some or most of the disputed items which they are unable to verify within 30 days. In the meantime, it will seem that this fraudulent agency has delivered on its promise.

But if the credit bureaus verifies the items at a later date, they’ll end up back on the report – plus you will have earned the reputation of being a hustler!

2. They tempt you to bend the rules – they will employ illegal tactics, such as using other people’s identity to improve credit score, by offering to give you a new SSN, so that you can “start from scratch.”

Beware! Such tactics can land you in a lot of trouble. Besides the fact that it’s against the law to take up a “new” SSN, the number could have a police record attached to it, or any such things that will be far worse that having bad debt.

3. They ask for full payment up front – a good many credit repair scams ask for full payment before rendering their services. This is understandable, because they know that sooner or later you will discover that they cannot really remove bad credit or improve your credit score as quickly as they claimed. And at that point, you won’t pay them.

It’s entirely possible to avoid credit repair scams. Just remember that no matter how desperate your situation, look out for the red flags!