Outsmart Scammers: Don’t Fall Prey To A Credit Repair Scam

Amid signals that the national economy may not have yet hit bottom, many Americans are finding themselves in dire financial straits, and it can be frustrating as you struggle to care for your family.

Bad credit history can keep you from getting a loan, a home, or even a job. You might see ads on TV, in the newspaper, or online with offers for credit repair services, which can be very tempting.

These ads promise to get you through bad credit, bankruptcy, or maybe a bad loan, but beware. There is no quick fix to repair credit issues, and you might even find yourself in more trouble if you fall for one of these scams.

The National Consumers League offers a few tips to consider for recognizing and protecting yourself from a credit repair scam:

• No one can erase negative information if it is proven to be accurate, and only mistakes can be amended on your credit report. Accurate information stays on your report for 7 years.
• You can correct mistakes on your credit report yourself. You have a right to one free copy of your credit report per year, and it is free to question or dispute any incorrect information that appears on your report.
• You can add an explanation to your report. If you’ve lost your job or fell behind in payments because of a major illness, you can request that the credit bureau add a short statement to your file.
• You can’t create a second credit file. You should know that any company that offers to help you build a new credit file with a different tax identification number or social security number is scamming you. This is called “file segregation”, and it’s illegal.
• If you have credit problems, get counseling. There are non-profit organizations which can help you to get your credit back on track, often by negotiating payment plans with your creditors.

The Federal Trade Commission (FTC) reminds us that the only legitimate way to fix your credit is through time, conscious effort, and a personal debt repayment plan. Check out the FTC’s website for more facts and tips that could help you avoid falling prey to a credit repair scam.