Credit Repair Scams to Avoid
Once you realize your credit rating has been damaged by ill use of credit cards, the next step is to find help. The earlier you acknowledge you have a problem then it will take less time to fix. Depending upon the severity of your credit damage, it may take as little as learning to manage your money or as much as finding a credit counseling agency to work with you and your creditors to find a feasible solution.
Always remember that your credit score and information cannot simply be erased with the swipe of a magic wand wielded by a company that claims to have such authority. Your credit information can be altered only by one of the three major credit bureaus: TransUnion, Equifax, and Experian. There are plenty of credit counseling companies out there that will offer their services for free, as they act as non-profit benefit to the masses in the hopes of turning around the ever mounting number of debt in the country. What is not legitimate is a company that charges you for credit repair. There is no such thing as instant credit repair. Only one person can repair your credit – you.
The so-called credit repair companies do actually perform several tasks, but 9.9 times out of 10 there is no success or improvement with your credit report. Instead of working with your credit companies to help ease payments and working with you to help you understand the responsibilities of credit cards, they bombard all three major credit bureaus with disputes about every negative object in your credit report. For example, it is recorded that you failed to pay a June bill. This would be one of the objects disputed against. For a while it might be removed from your credit report as it is investigated. However, after the investigation finds that yes, you really did fail to pay that bill, it will go right back onto your credit report. The “service†you have paid for essentially did nothing – especially when you are completely able and allowed to file disputes on your own.
Another well-known scam attempts to give you a new ID. The “advisor†tells you to request an Employer Identification Number or EID from the Internal Revenue Service. This is because there are nine digits in the number just like a Social Security number. You can then use this number to apply for new credit cards and start afresh with a whole new credit history. It sounds good – but it’s a huge problem for you because doing so is illegal. What is more, anyone doing a credit check when you apply for a credit card, loan, or other financial transaction it is going to look quite odd for someone who is 30, 40, or even 50 years old to have absolutely no credit history up until this point. After a bit of double-checking, the use of the EID will be discovered and you will be worse off than you were with just bad credit.
It may seem longer and harder to repair your credit by means of discipline and limiting your credit card use, but it is your best bet to truly get your credit report back on track. Quick fixes and shortcuts will only serve to get you into trouble or leave you exactly where you began. By putting a little effort into your credit use, you can once again on your way to enjoying the freedom a credit card allows.