Too Good To Be True: Avoiding “Credit Repair” Scams

credit repair scam

With bills piling up and your credit score stuck in a downward spiral, it can be hard to resist the siren song of companies that offer to restore your good credit for a fee.

Unfortunately, as many people with over-extended credit have learned the hard way, a vast majority of so-called “credit repair” companies have little to offer but false hopes and empty promises.

At best, phony credit repair companies will take your money and give you little or nothing in return. At worst, they can make your credit problems worse or even get you tangled up in illegal activity.

Recognizing Credit Repair Scams

Legitimate credit repair companies will not ask you to pay for their services up front. Federal law prohibits them from collecting payment until they have completed the services promised. Nor will a legitimate company ask you to do anything that seems illegal, such as disputing accurate information on your credit report or creating an alternate credit identity. Don’t believe anyone who claims to be able to do these things legally.

Only inaccurate or outdated information can legally be removed from your credit report. What’s more, creating a new identity to improve your credit score, for instance using an alternate identification number, is a crime. If you follow the advice of an unscrupulous credit repair firm and take part in illegal activities such as these, you may be opening yourself up to prosecution for fraud.

Get Real Legal Help, Not Gimmicks

What credit repair companies don’t want you to know is that there is no quick and easy way to repair your credit. While some may claim to have secret tricks or inside information, the truth is that there is no magic cure. The process of improving your credit takes hard work and patience.

Fortunately, there is help available for people who want to improve their credit scores by legitimate means. While it is possible for consumers to negotiate directly with debt collectors and credit bureaus, the process can be overwhelming and time-consuming, especially for people unfamiliar with the system.

If you have concerns about the state of your credit report, a lawyer with a background in bankruptcy and debt collection law can help you understand your rights and legal options, and will work hard to see that you are treated fairly by creditors and reporting agencies.