Credit Repair Services - Legitimate or Not?

Credit repair services are companies that assist you in repairing and improving your credit. However, many of these are fraudulent and make outrageous claims about being able to remove all kinds of negative items from your credit report including bankruptcies. Some even claim they can show you how to set up a brand new credit identity.

The truth is there’s no way to legally remove legitimate items from your credit report except by making timely payments and repaying your debt. Then as time passes, these old debts, judgments, late payments and bankruptcies will carry less weight until they ultimately drop off your report in seven to ten years. The problem is many of these companies collect your money upfront so by the time you learn this can’t be done quickly, it’s too late.

They will show you how to create a new credit identity by applying for an Employer Identification Number to use instead of your Social Security Number when applying for loans or credit cards. While this is perfectly legal if you’re starting a legitimate business, it’s illegal if you use to it deceive creditors. It’s a federal crime to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses. So it’s best not to go this route.

Most credit repair services that are scams will ask for money upfront before they provide any services. They don’t let you know your rights or what you can do yourself for free. They will also recommend that you don’t contact the three credit reporting agencies directly. Any of these warning signs should signal a red flag.

While there are legitimate credit repair services out there, why pay someone to do what you can do for free? This is even more important if you’re struggling financially to begin with. Most of these credit repair scams prey on people with lower than average credit scores. They’re hoping that out of desperation, they can lure people in with promises of quick fixes and new identities.

Don’t fall victim to these scams. The money you would have paid these companies will be more helpful if you apply it to your debt. The first step in helping yourself is to know what’s on your credit report. Find out how to get your free annual credit report from each of the three credit reporting agencies. Once you have this, you can review it and correct any errors you find. Check out the section on improving your credit to find out how to do this and lot’s of other helpful advice on how to attain a good credit score.

From Credit Repair Services to Your Credit Score