Credit Repair Scam
How to Avoid Being a
Statistic?
by Bill Smith
A good credit history is critically important for the consumer.
A bad credit will prevent you from getting a business loan, owning a home, or
even a job. Promises to "fix" your credit are always made by credit
consolidation companies, but they are seldom true. Here are some of the
important tips to avoid scams:
First things first. Negative information cannot be erased if the
information is correct. Only inaccurate information can be corrected in your
credit file. Credit file information remains on your record for seven good years
from the time it is reported to the bureau. For bankruptcy, the information
remains on your record for ten years. All the consolidated information about
your credit bills you fell behind on, but are now paid, will remain on your
report for the time period mentioned above.
Do not pay the credit repair company unless their promises are kept. Remember,
the law is on your side. Federal law requires credit repair companies to give
you a complete detailed explanation of your legal rights, a completely
documented written contract, and above all, 3 days to cancel. This applies to
all credit repair services including for-profit services, non-profit services,
creditors and credit unions.
Be wary about emails you receive. When you hover your mouse over the link in
the email, you will know for sure if it is a trusted website or a fraudulent
one. If fraudulent, report it to your bank promptly.
You don't need a counselor to correct your mistakes in the credit report. Take
charge of it yourself. If you were recently denied credit, you can request a
free credit report. Otherwise there is a small charge for it. Some states will
allow you a free copy of your credit report once a year. It doesn't cost you
anything to dispute or question items in your credit report. Get online or
follow instructions from your credit bureau. The three major credit bureaus are
Equifax (800- 685-1111), Experian (800-682-7654) and Transunion (800-916-8800).
In most cases you will need to contact all the three credit bureaus as the
information they have about you may vary.
Remember that you can't create a second credit file. Some of the fraudulent
companies will offer to provide the consumers with a different social security
number (tax identification number if ssn does not exist) in order to create a
new credit file for the consumer. Such a practice is called as "file
segregation". File segregation is illegal and does not work.
Whenever possible, add explanation to your credit report to prove your point.
If you have legitimate reasons for not paying certain bills on time (switching
jobs, illness), or if you refused to pay because of a dispute, send the bureau a
statement to be tagged with your credit report. Each lender who pulls your
report will be aware why you fell behind on those bills.
Counseling might be a good option. Find a good non profit consumer credit
counseling service in your neighbourhood. Get online or open your yellow pages
to find one. Seek the guidance of friends and family members. Select a
counselor, meet them in person to make sure they are right for you. Ask them on
tips and advice on how to build a good credit history. If you are still lagging
behind on your payments, credit consolidation firms will be able to set up a
payment plan with your creditors. If money is an issue, select a non profit
credit counseling service. They will offer their service for free or for a very
low cost.
Bill A Smith is a credit counselor for Ameri credit counseling services. Bill
has over 10 years of experience in providing credit consolidation, credit
counseling and credit management services to clients. Ameri credit services
provides credit consolidation and credit counseling to customers. Visit us at
http://www.americreditservices.com
for free credit consolidation articles, free credit counseling tips and non
profit credit management services.