Credit Repair Scams
Home & Mortgage
If you have a bad or mediocre credit score, it is important for you to get your credit repaired. You can hire a professional credit repair service to do this for you, or you can do your own credit repair. There are benefits to both approaches, and in the end it will come down to whether you are willing to do the work of getting your credit fixed or if you would much rather have someone else take care of your problem.
Credit repair does not require any significant type of training, although it is important to be persistent and organized, and to be able to do some financial reckoning. It is also very helpful to have good knowledge of the laws that are of relevance to credit repair, such as the laws governing credit reporting agencies and credit repair organizations. One more thing, the process of doing credit repair can be made to go much more smoothly if handled in a skilled diplomatic manner.
Just about anyone can do credit repair, but some people are just not comfortable about having to go through the process. If that is how you feel, then you can always hire a professional credit repair service. However, you need to be aware that there are a number of possible credit repair scams. One common scam occurs when a credit repair firm disputes a number of items on a client?s credit report, which causes the credit reporting agency to strike out these disputed items until such time as they are verified. The scammer presents the client with a ?clean? credit report that no longer contains the disputed items, and then demands payment. What the client does not realize is that the removed items can return on the next credit report, in little more than a week?s time from the filing of the dispute. Thus the ?service? performed will have had no effect on the client?s credit score, and the client will have paid for nothing.
To protect yourself from falling victim to a credit repair scam, you have to stand for your rights as a consumer. You should familiarize yourself with the Credit Repair Organizations Act, which offers you some substantial rights and protections. The Act specifies that credit repair firms must inform you of your rights and obligations before you can sign a binding contract with them. They are also prohibited from extracting their fee from you before they have provided the services they were contracted to perform.
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