How to Recognize a Credit Repair Scam

With today's economy and extensive credit debt, more and more scams are popping up telling you that they can do a credit repair for you. Is this for real? In most cases, this is a scam and someone is trying to take what little money you have left. You need to know how to recognize a credit repair scam before you spend your hard-earned money and receive nothing but headaches.

Difficulty: Easy

Instructions

Things You'll Need:

• This ehow article

1. Asking for cash up front is a sure sign that you are not going to get the results you are promised. The Credit Repair Organization Act does not allow any credit repair company to ask for any type of money upfront. You are not required to pay for any services until the services are completed.

2. Repair credit services have to tell you what you can do for yourself that cost nothing because you do the work. They have to tell you your rights and explain how you can correct some of the credit problems yourself.

3. Directing you not to contact any of the three major credit reporting agencies is another sign of a credit repair scam.

4. Repair companies that tell you that they will get rid of all or most of your negative credit history even if it is accurate and current is just another credit repair scam. It is impossible to wipe out accurate credit reports.

5. Telling you to establish a new credit identity is another warning sign you are going to be scammed. They may tell you to apply for an Employer Identification number to use rather than using your current social security number.

6. Telling you to argue and dispute all the history and information on any of your three credit reports is a sure sign of a scam. You cannot dispute any correct information. You need proof and documentation to file a dispute.

Tips & Warnings

• If you want to repair your credit report, you can only repair information that is wrong and you will need proof with documentation.
• If you follow any of the credit repair company's advice and break the law, you will be liable for federal criminal charges.
• It is illegal to apply for an Employer Identification number under false pretenses.
• If you ever see an advertisement saying they can get rid of bad loans, liens, judgments and bankruptcies, run as fast as you can.

Resources

• Protect Yourself From Auto Repair Scams

[elyria]

on 2/1/2009 Very informative - thank you!

[drking]

on 1/25/2009 Very good to know.

[justmeboy22]

on 1/10/2009 very interesting info, thanks!