If you are struggling with a poor credit score, you’re probably thinking about contacting credit repair companies to help you solve your problem. After all, it seems like the ideal solution to help you get your credit score up and your credit issues resolved once and for all.
These companies will charge a fee to have negative information removed from your report, have good information replace it, and ultimately you’ll end up with a credit score that is much better than the one you currently have.
It’s unfortunate but there are many scammers pretending to help people in the credit repair industry, but reality says that they aren’t going to be able to do a thing to help fix credit reports.
So how do you spot scam credit repair organizations? We’ll show you the signs to look for that will make it easy for you to spot a credit repair scam.
- Did You Receive a Copy of the Consumer Credit File Rights Under State and Federal Law Document?
If you’ve already chosen a credit repair company, one of the first things they should do is provide you with a copy of the Consumer Credit File Rights Under State and Federal Law document.
Did you get it?
If not, then you’re dealing with a scam company because by law, every credit repair service is required to provide a copy of this document.
So, if you begin the process of looking for a credit repair company, ask them to provide you with their documentation ahead of time. If this document isn’t part of the documentation that they offer, then you should move on and find a different option.
According to CreditRepair.Company, a website known to compare the best legitimate companies that repair credit, “The Federal Trade Commission provides a list of ways to identify a scam.” So if you’re looking for more info, the FTC website is a great place to find additional information and resources.
- The Company Wants to Receive Their Payment Upfront
When dealing with credit repair companies, if your situation never requires you to pay for your services upfront, you should immediately recognize this red flag and walk away from this company as fast as possible.
Why?Legitimate companies do not charge upfront fees. As a matter of fact, it’s actually against the law. Unfortunately, a great number of credit repair companies have a tendency to break the law in this situation. Some of them might not be aware of it, but others are really just looking the scam you, so you should stay far away and never give them your money until services have been rendered.
- The Credit Company Wants You to Create a New Identity Using Your Social Security Number or Federal Employee Identification Number
Obviously, if a company ever tells you to create a new identity, you know right away that you are dealing with a company that’s doing shady things. It should be quite obvious that they aren’t going to fix your legitimate credit problems, although they are going to attempt to create a new identity for you.
As you can imagine, the only way that scenario is going to end is in heartache. In fact, if you let them go through with this, it’s quite possible that you could find yourself in serious trouble with the law. So please do yourself a huge favor and avoid any credit repair company that recommends creating a new identity with your FEIN or SS number.
To sidestep wasting lots of time and money, please use this guidance to avoid becoming victim to a credit repair scam.