I’m sure you’ve heard lots of stories of people who have sought out credit repair agencies for assistance to improve their bad credit report, only to be ripped off by credit repair scams. Before you understand what actions must be taken to protect yourself against such unscrupulous people|these scammers|these crooks}, you must learn how they function.
They’re betting that those who find themselves undergoing financial hardship are in such desperation as to believe anything that is told them, hoping these fraudulent companies are really able to lead them out of financial despair, so they can reclaim their lives. They will often be so disheartened by the system, which is downright cruel to people who suffer from credit problems, that they’ll take any measures to resolve their problems.
Most of those seeking help are close to bankruptcy, or at least contemplating it. These are the people who are the easiest targets of credit repair scams.
The reason? Because they are impatient, and don’t realize that fixing their credit requires at minimum 6 – 12 months. Very often, they feel like time is running out on them, and unless they act quickly, it will spell future disaster. Ironically, when they sign up with these scam artists rather than ridding themselves of debt, they will lose whatever little money they still had, since they’ve been chasing a mirage.
Beware of these red flags that point to credit repair scams:
1. They promise too good to be true results – many of these agencies promise they will get all adverse accounts deleted from your credit report. They will guarantee you that your credit score will improve within 2 or 3 months.
They try to accomplish this by disputing every negative trade line in your report. The bureaus may initially remove some or most of the disputed items that can’t be verified in the space of 30 days. In the meantime, it might look as though this fraudulent agency has delivered on its promise.
But if the credit reporting agencies is later able to verify the negative items, they’ll go back on the credit report – plus you will have earned the reputation of being a hustler!
2. They play fast and loose with the rules – they use illegal means, such as using the identity of others to increase your overall credit, by offering to give you a new SSN that has no bad credit record, so that you can “start your financial life over.”
Beware! Such tactics could put you in hot water. Besides the fact that it’s against the law to take up a “new” SSN, the number could have a police record attached to it, or any such things that will be much worse than bad credit.
3. They require all their fees be paid up front – these credit repair scams are characterized by the fact that they ask for full payment before rendering their services. This makes sense, because they will be worried that you will soon discover that that they can’t deliver as quickly as they claimed. And at that point, you would refuse to pay.
It’s entirely possible to avoid credit repair scams. Just keep in mind that no matter how desperate your situation, look out for the red flags!