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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
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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.
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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.)
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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.
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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.
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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 |
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