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Credit Repair Scams - Danger

By Jim Eastman

Republish: EasyPublish™
Published: 20Sep2009
Word count: 532
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I'm sure you've heard stories about people who have gone to credit repair organizations for help to improve their low credit score, only to be taken in by credit repair scams. So that you can understand what must be done to avoid being ripped off by these crooks, you must be aware of how they function.

They know that those who find themselves up to their neck in debt will be desperate enough to swallow whatever is told them, in the hope that these fake agencies will really be able to improve their credit score, so they can regained their peace of mind. They are often so disheartened by the system, which is downright cruel to people who suffer from credit problems, that they'll do anything to get it fixed.

Most people looking for help are ready to declare bankruptcy. It is these who are most vulnerable to credit repair scams.

Why? Because they feel a sense of urgency, and are unable to internalize the fact that the process of repairing a credit report can take up to 12 months. Very often, they feel like time is running out on them, and unless they take fast action, it will be too late. Ironically, when they hire these company's rather than solving their financial problems, they will find themselves worse off than ever, since they've been chasing a mirage.

Here are some red flags to avoid credit repair scams:

1. They promise impossible results - these less than honest companies promise to get every negative trade line deleted from your credit report. They will guarantee you that your credit score will improve in a very short time.

They attempt to do this by disputing everything negative in your report. The credit reporting agencies may initially remove some or most of the disputed items which they are unable to verify within 30 days. In the meantime, it might look as though this fraudulent agency has delivered on its promise.

But if the credit bureau can verify the negative accounts at a future date, they'll end up back on the report - plus you will have earned the reputation of being a hustler!

2. They urge you to violate the rules - they actually break the law with their tactics, such as using the identity of others to increase your overall credit, by offering to give you a new Social Security Number, so that you can "start your financial life over."

Beware! Such tactics could put you in hot water.

Not only is it illegal to take up a "new" SSN, the number could have a police record attached to it, or any such things that will be far worse that having bad debt.

3. They demand full payment up front - a good many credit repair scams are characterized by the fact that they ask for their fees in full up front. This makes sense, because they know you will find out that they cannot really remove bad credit or improve your credit score as they had promised. And at that point, you would refuse to pay.

Know that you can avoid credit repair scams. Just remember that no matter how desperate you become, don't ignore the warning signs!

Jim Eastman writes on matters of ethics in business. For more great tips on credit repair scams visit http://www.ecraonline.org/blog - Free Report

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