The most important thing you should look for when you’re looking for reputable credit repair services is the affiliations of the business you chose for this purpose. Every reputable company will willingly provide you with their references on request. These are some important issues to keep in mind in order to steer clear of deceitful credit repair companies.
1. Make sure the company belongs to the Ethical Credit Repair Alliance (ECRA) or another reputable regulatory body. You are often advised to select companies who have membership in the BBB (Better Business Bureau) However, in the case of. those agencies affiliated with the ECRA are always a good choice.
This organization holds its members to very high ethical standards and any business that gets their approval will give you their best services. All credit repair companies that have membership in this organization will have to maintain high standards in everything they do pertaining to repair of credit. As a result this means protection for you from any kind of dishonest practices.
2. Know what credit repair is before seeking help. Most of those who end up being scammed when hiring help with their credit, do not know anything about what repair of credit involves. You should be knowledgeable about what these companies are able to do and what they are not able to do.
Only when you know clearly this difference, will you be able to distinguish those companies in which you can place your trust. For example, no one can remove negative remarks entered on your credit report if these can be verified. There are those credit repair companies telling you that within as little as a month you can have a completely clean credit report. Now take a close look; is this even possible to do legally? And if not you had best pass on their services.
3. Avoid unsolicited offers you receive through email. It’s not fate that sent you an email offering to repair your credit at a time when you are desperately looking for help. These e-mails are sent by scammers who use shady methods to get your e-mail address, and send spam to millions in the hope that they will “catch” a person desperate for help whom they can scam for all they’re worth!
Beware of such emails. In the vast majority of cases these are unscrupulous thieves hoping to prey on the unwary. Reputable credit repair companies will send their offers through newsletters or emails only after you have requested information.
4. Creating a “new identity” cannot be done legally. This is the “Big Lie” many people fall prey to, primarily because it looks like the “Silver bullet” that will resolve all their difficulties. This belief is once again mainly because people do not understand what credit repair is all about. This method is called “File segregation” and it’s most definitely illegal!
Your credit score is a summation of your credit history that goes back to the time you first became an adult. Thus, it’s just not possible to get a “new” credit history. And if you do so, does it seem to you like this would be legal? So it’s clear that the credit repair companies that offer this “solution” as a way out of your troubles are crooks.
5. Asking for full payment upfront should raise a red flag. Federal Law stipulates that the agency must provide you with a written contract and that they cannot charge you full payment until they have completed their services. You have the right also to cancel the contract within three days.
A credit repair business can ask for an upfront charge for initial services, such as a credit report analysis, then continue to charge by the month as they follow up every month with the credit bureaus to improve your credit. But if a company demands their entire fee be paid in advance, it may be because they are aware you will not be inclined to pay later when it becomes obvious that their claims have been exaggerated. Organizations such as these are fraudulent and you should avoid them like the plague!
6. Repairing your credit is a time-consuming process. As stated previously, no reputable organization can repair your credit overnight or delete derogatory accounts from your credit report if it is verifiable.
At best it takes two or three months to fix minor problems, by disputing information that is incorrect, and by improvement in your financial habits. More serious derogatory items such as leans and foreclosures remain on your report for 7 years (bankruptcies for 10), notwithstanding the best management of your finances. Bankruptcies can remain on your credit report for 10 years. “Guarantees” that these can be removed overnight means fraud.
7. No contract? Forget it! To avoid being scammed, make certain you are given a written contract; under the law a written contract is your legal right. Fraudulent companies will shy away from offering you such a contract, and if they do present one, there will be an absence of information regarding what services will be provided, the fees charged, and the like. You will learn a lot about these businesses based on their contract. If they do not offer a contract for any reason whatsoever.
8. Do not trust any agency that guarantees results! Even the top quality companies will guarantee results of their services they provide you. They can realistically promise to use all legal means to improve your credit score. However, in the credit repair business there can never be any hard core guarantees in regard to results.
But an unfortunate fact of human nature is, people believe what they want to hear and prefer to hire a company who tells them as much, rather than hire a credit repair business who gives them an honest and truthful assessment of the situation. Avoid this all too common self deception! Even though you would prefer to hear about guaranteed results, credit repair companies that give you guarantees regarding results are out to scam you.
9. Look for counseling services. Many quality credit repair companies will give you free counseling services.
If the business being considered does not offer counseling services, look a bit beyond. It may be a less than trustworthy company. Trustworthy agencies encourage their clients to become knowledgeable in regard to credit repair. The company performs those services that are for those matters that need continued and persistent follow-up to effect the best results.
10. Wrong advice means danger! Some organizations will dispute all the negative entries on your credit report saying “this is not my account..” Even though in the short term the credit score may improve, the creditors whose trade lines were disputed may later counter it, and it will later be verified by the credit bureaus.
Given the shabby record keeping on the part of the credit bureaus, the likelihood is great that all the details of any item on your credit report may not be accurate. But credit repair companies that have you proclaim “this is not my account” although it really is, are not trustworthy.
As you can see, there are plenty of warning signs to alert you to possible fraud. The first thing you must do when you seek to hire credit repair companies it is to become knowledgeable regarding credit repair matters. You also need to know the minimum applicable laws before looking for a credit repair company. For starters visit the web sites of the FTC Bureau of Consumer Protection and the Ethical Credit Repair Alliance.
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