How to Spot Credit Repair Scams

How to Spot Credit Repair Scams

There are many things credit repair companies are not allowed to do or promise customers. If it sounds like it’s too good to be true, it probably is, and you should steer clear of that company. Here is a list of signs that you should look out for that may be a red flag that a company is not legitimate.

1. Company claims Guaranteed Results

Under the Credit Repair Organizations Act (CROA), credit repair companies cannot guarantee results. Here are a few common examples of false promises unethical credit repair companies might make:

  • Improvement to your credit score
  • Results in a fixed time period
  • Removal of all of negative items, even if they are accurate

2. Upfront Payment is Requested

The CROA prohibits credit repair companies from asking for any payment before they provide any services. Many scammers know that most consumers don’t know this and, as a result, promise a quick turnaround on credit repair for a large upfront payment. Again, if it sounds to good to be true, it probably is.

3. Claims a New Identity is Needed

A credit repair company can’t promise or offer you a new identity. Anyone offering you a new identity is a fraud. Besides guaranteeing results, scammers may try to promise you a clean slate with a new Employer
Identification Number (EIN) or a Credit Privacy Number (CPN).
They tell you to use these numbers on your future credit applications instead of your Social Security Number. We explain more about common credit repair scams below.

4. Don’t Explain Your Legal Rights

Credit repair companies should explain your legal rights to you from the beginning. These are a few
common things an unethical credit repair company might do.

  • Tells you not to contact the credit bureaus directly
  • Doesn’t give you a copy of the contract to review before signing
  • Fails to inform you that you can repair your credit yourself without the help of a credit repair company
  • Leaves out important information from the contract, like the date services will be executed or that amount you will pay

If you feel like the company isn’t telling you everything or refusing to answer your questions, you should seek services elsewhere.

5. Asks You to Misrepresent Information

Finally, an unlawful credit repair company might ask you to misrepresent your information. This can range
from unlawfully using an EIN or CPN number in place of your social security number to claim you are a
victim of identity theft when you’re not.

Any of these sound familiar?

We can help you repair your credit the right way. Contact us today.

What to Do If You Are Scammed

There are a few things you can do if you realize you’ve fallen victim to a credit repair scam. Take a look at your options below.

  • Report the organization to your state attorney general
  • File a complaint with the Federal Trade Commission and the Better Business Bureau
  • Consult with an attorney if you’d like to take further legal action

How to Safely Repair Your Credit

Making payments on time and disputing inaccurate or duplicate information on your credit reports can help you repair your credit. While you can do this on your own, US Allied Financial will make the process easier and more efficient. US Allied Financial proudly adheres to CROA to make sure we give our clients the best experience possible. We’ve helped clients challenge information that is unfair, inaccurate and unverifiable. Give us a call today so you can start on the path of better credit!

Repair your credit today.

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