Credit Repair - Shortcuts To Fixing Your Credit Report Can Backfire

Using credit repair services can sometimes cause more harm than good. Be wary of empty promises and quick fixes to your credit report. Taking the wrong advice can even get you into legal hot water.

Some credit repair services say they can give you quick debt relief and easily repair your credit report. However, many of them have proven to be less than honest. credit repair For this reason, Congress passed the Credit Repair Organization Act in an effort to alleviate some of the dishonest behavior pursued by flagrant offenders.

This act makes it illegal for any such organization to advise a client to either alter their identification, or attempt to hide accurate credit report information.

What to Watch Out For

There are several signs to look for when comparing credit repair services. Here are some of the situations to avoid:

* Repair companies that require payment prior to services rendered

* and who do not provide you with a statement of rights.

* You are summarily advised to dispute all information in your credit report without justification.

* You are advised to create a new "credit identity" by using an Employer ID (EIN) instead of your social security number.

* The repair company conducts all creditor and credit bureau communications, discouraging direct access to them.

Potential Impact

Following these strategies can result in federal prosecution for providing inaccurate information, obtaining an EIN under false pretenses, and/or mail or wire fraud. credit repair You are responsible for all actions taken by a credit repair service on your behalf. These can be serious offenses and shouldn't be taken lightly.

The Alternatives

You have the right to cancel any contract with a credit repair organization within three days after signing it. In addition, the Credit Repair Organization Act requires repair companies to complete all work before demanding payment. If you suspect unethical practices by a company representative, you should refuse their services and report their actions to your local authorities. credit repair If you participate in any illegal activity when trying to clean up your credit report, you can be criminally prosecuted, even if it wasn't your idea.

There is no magic to credit repair and nothing involved in it that the average consumer can't accomplish themselves. You are entitled to one free credit report annually from each nationwide credit bureau, plus you can request one every time you are denied credit or "adverse action" has been taken against you. That is the starting point for conducting your own free credit repair.

Don't be pressured into doing anything you think is unethical or dishonest. As the saying goes, if it sounds too good to be true, it probably is.
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