Use Extreme Care When Choosing a Credit Repair Company

There are many credit repair rip-offs to watch out for. These offers always state that they assist with bad credit, when in reality, far too often, they will overcharge you, cause you to do something illegal, or get you into a worse situation financially. Don’t be taken in by any of these common types of scams.

1) Companies that suggest that you lie on an application for a loan or urge you to get a second identity. This could get you in trouble, in addition to being just plain dishonest. If one of these organizations tries to get you to open accounts or apply for loans with false information, you should tell them to take a hike.

You might wind up being charged with fraud if you follow this bad advice, even though it was from the credit repair company’s suggestion. The only thing worse than sorting out your credit problems would be to add legal problems as well.

1) Credit repair companies that charge fees to do relatively simple tasks that really would be best for you to do yourself – such as preparing a budget. You should also be wary of companies wanting to charge you money up front.

There is an abundance of great information online for anyone wanting to eliminate credit card debt and repair their credit. Do this before you pay someone else for much of the same information.

1) Credit repair companies that accept payments from you that are to be paid to your creditors, but that are kept in an escrow account. Although common, this is a scam that turns out to be a huge problem for unsuspecting debtors.

Here’s how this scam works: you provide money that you intend to be used by the credit repair company to pay down debts. The money is placed in an escrow account by the company where is accumulates. The idea is that your debts will be paid from the escrow account by the company once the balance of the account equals the amount of your debts. The problem is that the company may be taking money out of the escrow account to pay themselves administrative fees, but your creditors are getting nothing, so your interest charges could be increasing and the creditors may even initiate legal action. Your credit rating could be further damaged using this so-called credit help.

4) Credit repair companies that put pressure on you, try to get you to sign a commitment you haven’t read, or don’t listen to your needs and concerns. It is best to leave well enough alone and move on to another company that proves they can be trusted.

5) Companies offering to repair your credit instantly, without taking into consideration the current condition of your credit. No credit repair company can legitimately deliver on this type of misleading claim. The fact is, if you have very bad credit, it could take several years to fully repair it. It is generally best to focus you attention mostly on how to eliminate credit card debt, knowing that your credit history will improve over time as a result.

Credit repair companies sometimes claim that they can have items reflecting poor credit removed from your credit report by disputing them. This is false information. True and accurate information cannot simply be removed from your credit report. While a credit bureau must investigate a claim of inaccurate information within 30 days, this does not suggest that the information will automatically be removed. Refuse to do business with any credit repair company making this claim and keep looking for honest help.

Hopefully, these tips will help you avoid credit repair scams and allow you to properly locate companies that can truly help you with your credit card debt elimination plans.