Tell-tale Signs of Credit Repair Scams

The Federal Trade Commission (FTC) warns consumers against seeking credit repair assistance from scammers and illegal credit repair agencies. True enough, going through a financial crisis can make anyone vulnerable to scams and rip-offs. Recognizing the signs of fake credit repair services can help you stay out of the danger. What are these signs that you should be aware of?

Upfront payment. A genuine credit repair or credit counselling agency must never demand for upfront payment before providing service as it is a direct violation of the laws stipulated in the Credit Repair Organizations Act.

Advises you to lie or use false information. If your credit counsellor encourages you to violate the law, then obviously you are dealing with the wrong agency. For instance, you may be told to declare a different Social Security Number or use your EIN (Employer Identification Number) to change your credit identity.
Lying or using false information to get away from your obligations will not resolve the problem. It will only put you in far worse situation. In the end, you will find yourself in an even bigger dilemma than you are in right now. In fact, you will be charged and prosecuted for the crime of fraud.

Promises to instantly fix your credit history. If the charges in your credit report are accurate, there is no way you or any of the three credit report agencies can erase those charges. The only way you can regain good credit standing is by paying your creditors.

You are not told about your rights. A real credit counsellor must first and foremost explain to you your consumer rights based on the Fair Credit Reporting Act (FCRA). Before signing up with the credit repair service, you should be handed a copy of the Consumer Credit File Rights Under State and Federal Law. See to it that your contract clearly stipulates the exact credit repair service you will be provided, the estimated length of time before you can see result, and all the fees that you are expected to submit.

You are not given practical advice. The truth is, there are a lot of steps that you can do to help yourself without spending a penny. For instance, you are entitled to receive a copy of your credit report for free if you suspect to be a victim of fraud or ID theft; if you have been denied credit or employment; or if you are unemployed and plan to find a job within 60 days.

Did you know that you can get a copy of your credit report on your own simply by visiting The website is supported by the three credit report agencies Equifax, Experian, and TransUnion. You may also call 1-877-322-8228 or fill out the Annual Credit Report Request Form and send it to:
Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281

In addition, you have the right to dispute unauthorized charges or errors in your report. You can do this on your own by sending a dispute letter to the bureau that issued your report. Upon receiving your complaint, the bureau shall have 30 days to complete an investigation regarding your issue. If your dispute is found valid, you will also be sent an updated copy of your credit report for free.


About the Author:

Suzy Vanstrusen is a credit analyst and a writer on the website She has been providing consumers with tips and wise information about credit repair as well as helping you out more with your bad credit loans.  Copyright © 2010

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