A bad credit score can prevent you from advancing in life.
You must postpone major purchases, endure high interest rates and be handicapped from making investments in your future — such as going back to school or starting your own business. It may seem relentless and overwhelming. But that doesn’t mean you have to take drastic measures to get ahead.
Have you ever seen ads for credit repair services? These companies offer the sort of drastic measures you must steer clear of. Companies claiming to “erase your bad credit” or “create a new credit identity” are just plain frauds, and the FTC agrees.
No one can legally remove accurate and timely information from your credit report — even if it negatively impacts your credit score. These companies understand how frustrating bad credit can be and use it to their advantage. They batter customers with long-winded sales pitches that are overly complex and vague and play on their frustrations in order to get them to pay for fake services.
Credit repair scams have shady tactics and steeper price tags. Victims are typically swindled out of hundreds, if not thousands of dollars, putting consumers even further in debt.
It’s important to note that there are legitimate credit repair services; however, they will only remove inaccurate information from your credit report and provide you with educational resources. Services that are free if you wish to do them on your own.
Often, credit repair scams will just take your money and run — providing no services whatsoever.
A sure sign of a scam is when there are upfront fees for services — an illegal practice for credit repair services. During enrollment, the services should clearly explain your legal rights, the cost of services and any guarantees. You are also granted three days to cancel your services without charge under the Credit Repair Organization Act.
Alluding to their scam, fraudsters will forbid you from contacting credit reporting agencies directly. This tactic is an effort intended to prevent you from discovering that your score has not changed; remember, viewing your own credit file will not impact your score.
Some credit repair scams may attempt to improve your score through illegal avenues. They may force you to commit fraud by disputing accurate information on your report or will have you provide false information on new credit or loan applications. This is known as synthetic identity theft and is punishable under federal law.
Bottom line: there is no instant fix for a poor credit score. Repairing your credit takes time and dedication, but it is possible.
So how can you improve your credit score the right way?
- Pay your bills on time
- Keep balances low on credit cards and other “revolving credit”
- Apply for and open new credit accounts only as needed
- Pay off debt rather than moving it from card to card
- Monitor your credit score for unusual activity, which may signal identity theft
- Request a free copy of your credit report at Annualcreditreport.com
If you believe you have fallen victim to a credit repair scam, you should contact the Federal Trade Commission immediately. You may file an official complaint and find information regarding your legal rights. It is also wise to place a credit freeze on your credit report to prevent anyone involved in the credit repair scam from tampering with your account or committing identity theft.
The views and opinions expressed in this article are those of EZShield Inc. alone and do not necessarily reflect the opinions of any other person or entity, including specifically any person or entity affiliated with the distribution or display of this content.