How to Avoid Credit Repair Scams

Every other day, you may find yourself listening to or watching an advertisement on the radio, TV or even the internet, regarding a company that claims it can fix or increase your credit score. Right after you have gone through the experience of bankruptcy or have recently suffered a blow to your credit, taking help from Credit Repair Companies seems like such a safe and cushiony option. Yet the reality lies at the opposite side of the spectrum.

Identifying Credit Scams

You may just as easily be tricked into a fraud as you decide to affiliate yourself with a Repair Company, which is why you must make sure you are able to identify a Repair Company that performs illegal work from genuine ones. Let us take a look at some ways through which you can know when you have come face to face with a scam.

You are better off backing away if the company:

• Insists that you pay for the services before services have been provided.
• Does not inform you of your legal rights and actions you can take yourself.
• Restricts you from contacting credit reporting companies directly.
• Tries to convince you to apply for an Employer Identification Number (EIN) instead of simply using your Social Security Number. They may be involved in illegally stealing Social Security Numbers and may, thus, involve you in crimes such as identity theft by allocating you one in the form of an EIN.
• Suggests you to provide false information on loan and credit forms. Doing so is a serious crime.

If you are aware of the signs that may arise when you are in contact with a fraud company, you can make the wise and conscious decision of reporting them and staying away from such scams.

Know Your Rights

For you to be able to avoid Credit Repair Scams, you must be aware of all the rights you hold. According to the Credit Repair Organization Act, it is illegal for a Credit Repair Company to keep back any information from you regarding the services they will be or can provide to you. Similarly, neither can they demand for you to pay them before they have worked for you. So to ensure your own safety, you must ask for the company you are working with to provide you with written documents that outline your legal rights and also highlight the services they will be investing in your case. Demand for guarantees, cancellation options, and decide on a definite amount you must pay after you have been given what was claimed.

What if it’s too late?

If you find yourself identifying a fraud company a little too late, there are still some steps you can take to make up for what you have lost. The first option would be to sue the company in order to win back what sum you had invested in them. Other options would include reporting the company to your state government and filing a lawsuit against them.

The best thing to do is to keep things in your hand and closely monitor all activity and details on your credit report. Always make sure to report any inaccuracies, and save yourself from becoming a victim in such scams and frauds.