Friday, August 21, 2009

Credit Repair Scams - Avoiding Tragedy

It's likely you've heard about those who have sought out credit repair organizations for help to improve their credit report, but to have instead been taken in by bad credit repair scams. In order to understand what pathway to take to protect yourself against these scammers, you must know how they function.

They're betting that those who find themselves up to their neck in debt will be desperate enough to grasp at whatever is told them, in the hope that these fake agencies really can deliver on their promises, so they can regained their serenity. They are often so disheartened by the system, which is downright cruel to those who have problem credit, that they'll do anything to resolve their problems.

Most those seeking help on the verge of declaring bankruptcy. It is these who are most likely to fall prey to credit repair scams.

And why is this? Because they want fast results, and are unaware that raising their credit rating 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 spell future disaster.

Ironically, when they sign up with these scam artists instead of improving their financial situation, they will find themselves in even worse financial straits, because they've been deluded into chasing a mirage.

Here are the warning signs that alerts you to credit repair scams:

1. They promise the impossible

These less than honest companies promise they will have all the negative remarks removed from your credit report. They will guarantee you that your credit score will improve within the next 2-3 months.

They attempt to do this by disputing every negative trade line in your credit report. The bureaus may initially remove some or most of the disputed items which they are unable to verify within the required 30 days. In the meantime, it will seem that this fraudulent agency has delivered on its promise.

But if the credit bureau is later able to verify the negative items, they'll end up back on the report - plus you will have earned a bad reputation - that of a scammer!

2. They tempt you to bend the rules

They actually break the law with their tactics, such as using other people's identity to increase your overall credit, by offering to give you a new SSN, so that you can "start from scratch." Look out! Such tactics can land you in a lot of trouble. 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 much worse than bad credit.

3. They ask for full payment up front

Most of the credit repair scams are characterized by the fact that they ask for payment in full up front. This is understandable, because they realize that you will eventually find out that they cannot really remove bad credit or improve your credit score as they had promised. And at that point, you won't pay them.

In conclusion, credit repair scams are avoidable. Just don't forget that no matter how desperate your situation, look closely for the warning signs!

And one more thing: Get your hands on a copy of "The Danger Signs to look for in a Credit Repair company" CLick here and fight credit repair scams!

Saturday, August 15, 2009

Credit Repair Company - Avoid Credit Repair Scams

A credit repair company by definition is an organization that helps to boost your credit report by various methods such as checking the accuracy of your report with the credit reporting agencies, taking action in regard to any credit report dispute as it arises, fixing your credit report in the wake of bad debts and so on. In other words, this is an organization that helps you improve your financial situation.

Just what does credit repair company do to improve your finances?

A lot of people argue for the "do-it-yourself" credit report repair method rather than hiring the services of a credit repair company. Is that better? It's your choice.

Here is what a credit specialist should offer you:

  • checking each trade line in your credit reports for accuracy: they should do this with the report from each of the major credit bureaus (Experian, Equifax, and TransUnion).
  • initiation of a credit report dispute when inaccuracies are discovered; following it up until all mistakes are deleted from the credit report
  • advising you on what are the best methods to adopt so as to improve your credit report as quickly as feasible
  • counseling you on how to best manage your finances, so you will not fall into debt traps again.
  • facilitating avenues that will enable you to earn your livelihood again
  • keep a close eye on the credit report maintained by each major credit Bureau, to prevent any errors that could damage your credit report
  • teach you how to maintain a good credit-to-income ratio that will reflect well on your credit report

What You Should Not Expect from a Credit Repair Specialist.

There are many people who expect near miracles from a credit repair specialist. Here are some things you should not expect from a trustworthy credit repair agency:

  • settle any credit report dispute in a very short time - it takes at least 60 days
  • repair credit history overnight - it requires at least of 6 months
  • wipe off bad debts - it takes at least 6 months
  • change facts entered in your credit report - it will remove only those itmes that are being reported inaccurately
  • erase a history of bankruptcy - it can only help you improve your credit score, since a bankruptcy stays on your record for a minimum 7 years
  • improve your credit report by tomorrow - credit repair is a gradual process that requires at least 3-6 months

3 Warning Signs That Point to an Untrustworthy Credit Repair Company

It is true that there are a lot of fly-by-night organizations out there who thrive on the gullibility and helplessness of desperate people, just to make a fast buck.

Here are three red flags help you avoid credit repair scams:

  • it demands complete payment up front
  • it promises you immediate results
  • it uses illegal means to improving your credit worthiness

Avoid any such credit repair company like you would the plague! Remember, a bad debt or even bankruptcy is not the end of the world. But using illegitimate tactics to fix poor credit will backfire on you.

Never be tempted into accepting such "help" because these organizations are not trustworthy and will lead you into an even more desperate situation than you're in already.

Monday, August 3, 2009

Assessing Credit Repair Companies

You hear so much about credit repair companies that if you're having credit problems you are very tempted to seek their help to improve your credit report. However, making a good choice may not be so easy, because you will find that evaluating such companies in not such an easy task! Because they are service oriented, there's no physical product to evaluate, and the trial-and-error method is ... well, completely out of the question!

Here are three points that you must consider before making a decision. These indicators will also keep you safe from being ripped off by less than reputable credit repair companies whose goal is to relieve you of your money, not your problems.

1. Honest Credit Repair Companies Are Affiliated With Organizations

Just as any legitimate business, a professional credit repair agency will affiliate itself with reputable organizations such as the BBB (Better Business Bureau) or the ECRA (Ethical Credit Repair Alliance). The affiliation would have these companies abide by certain business codes, that provides protection to you the consumer.

Determine to which organizations the company you are considering belongs to. What are they? Do not stop at finding out what affiliations they have - research a bit further and check whether these regulatory bodies are indeed what they claim to be. Research on the Net and get the complete picture.

2. Reputable Credit Repair Companies Have Many Satisfied Customers

It's always expected that a good local credit repair agency would have a fair amount of verbal positive feedback from local people. This is an excellent sign that this company delivers on its promises. However, do not trust them with improving your credit report just on the basis of hearsay.

Ask them to give you the the name of some satisfied customers who they worked with satisfactorily and then follow up with a visit. Most people will be happy to discuss their experience with the company. Ask them about their level of satisfaction, and whether they would recommend the company.

3. Above-Board Credit Repair Companies Do Not Sell You Shortcuts

There are no shortcuts in the credit repair business. Your credit score is not going to improve overnight, nor can you make your bad credit disappear.

Be wary about credit repair companies that promise an overnight makeover. It is likely that they are lying or that they are using illegal means. Don't be misled because this could end very ugly for you. Stick to legitimate methods to improve your credit rating and in the end you will be the winner.

As you can see, it is not too hard to choose the right one from among the many credit repair companies. Just remember that it's better to be cautious, than to act rashly and then regret it later.