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Credit Repair Services > Credit Repair Services: Companies Are Scamming You Beware!
Credit Repair Services: Companies Are Scamming You Beware! |
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There are a lot of companies out there offering credit repair services. But of the lot, very few of them are actually interested in helping you out; many of the other credit repair services are only interested in making money. But it's difficult to judge which companies are legitimate and which ones are not. But, if you keep certain things in mind, then it'll be difficult to be cheated.
One thing to remember is that credit repair services companies that claim that they can remove the negative information from your credit file are usually untrustworthy. You should know that accurate negative information cannot be removed by anyone; they're just trying to fool you. Accurate information, however damaging, cannot be removed by anyone until the legal time limits have expired. The legal time limit for reporting information and other requirements covering credit reports are governed by the Federal Fair Credit Reporting Act. The legal time period for reporting bankruptcies, in credit reports, is 10 years, while the legal time limit for reporting other adverse information is 7 years. Federal law also requires credit repair services to explain your legal rights to you and give you a detailed written contract. Legally you should get three days to cancel the contract. Consumers should also be aware that credit bureaus collect and maintain information on your credit-worthiness, credit standing and capacity, credit history and general character. This information is reported to them by financial institutions, department stores and other creditors. Also, for a fee, potential creditors, employers, insurers or anyone who needs it, for a legally approved purpose, can purchase your credit file. Another thing is that it's illegal for credit repair services to ask for their fees, before they've delivered what they promised. So, consumers should never pay until the repair service has been performed. Credit repair services are required to offer written contracts to clients, stating in detail, the items the company expects to remove from a credit report and by when it expects to remove the items. One basic tactic of a credit-repair company is to dispute every negative item in your credit report, accurate or not, by asking the credit bureaus for verification. As a rule, credit bureaus then request creditors to verify the information, and they delete a negative item from a file if they don't receive a response in 30 days. However, this deletion is only temporary, if the information is accurate. Therefore, even if an item is temporarily deleted, it will be restored if the credit bureau later receives verification from the creditor. Under the law, credit reporting agencies can continue to report accurate items that are within the legal reporting period. And no credit repair services company can ever permanently erase such items, from your credit record. Generally, only time can cure your negative credit history. But under the Federal Fair Credit Reporting Act, you've the right to dispute the accuracy or completeness of any information in your credit file. And once you tell the credit-reporting agency of your dispute, the agency is legally obligated to reinvestigate the information, note its current status, and promptly inform you of the results of the investigation and its decision. But the reporting agency is not obligated to pursue inquiries that it reasonably believes are frivolous. This usually allows reporting agencies to completely ignore the blanket disputes the credit repair services file as part of their repair tactics. Also, as a part of the credit repair services, you'll be making payments to the credit repair company towards your debt. However, you need to check your credit statements regularly to see if they're making the payments on time. If the payments you're making to them aren't showing up on your statements, or are showing up late, then you'll know there's a problem. You'll know that the credit repair services company is cheating you, in one or both of two ways. Either, they're keeping your money and not sending it to your creditors or they're sending your payments to your creditors late. Either way they're not doing what they promised and therefore are violating the law. In such cases, you need to report to legal measures. |
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