Are you having problems in getting approved for new credit? Is your credit is not perfect too. In such a situation, you need to try and repair your credit. In order to do that you’ll have to be aware of credit repair scams as well.
1. Why is credit repair vital?
Credit repair is vital for your financial prosperity. You need to maintain good credit to get any forms of new credit, to buy or rent a home and even to get a new job as well. Remember, once you’ll apply for any forms of new credit, the creditor or the lender will check your credit reports to know your credit score. Similarly, when you’ll be applying for a job, the employer may check your credit report. If you’ve good credit score then the employer will give you preference . The better your credit, the better will be your chances. Having good credit score shows that you’ve the ability to handle your finances well.
2. What is credit repair scams?
There are various credit repair agencies or you may seen ads from companies telling that “they can help you repair your credit” or “they are able to turn your bad credit history to fantastic”. Or you can get offers to “fix your credit” in your mailbox. These companies are scams.They rather than helping you in your problem, create problems for you.
3. How can I understand a credit repair scam?
1. If the company force you to pay them before doing any work on behalf of you.
2. If the company ask you not to inform or contact the credit reporting companies directly.
3. If they insist you to mention false data on your applications for loan or credit.
4. If they are unable to explain your legal rights while discussing your matter.
5. If they suggest you to dispute an errors in your report when you’re very much aware that the information is correct.
4. How I can avoid credit repair scams?
1. Ask for the copy for the contract so that you can read it before signing it.
2. Check your contract thoroughly that :
* It has all the details of the name and the address of the company.
* If there is the mentioned amount they are charging for the services,
* Check all the details of the services, date by which they are going to perform the services.
* Read the contract and make sure that you have the ability to cancel the contract within 3 days.
3. Don’t sign a form waiving the rights under CROA, or promises to create a new identity for you with new social security number or federal employer identification number (EIN).
4. Ask for the copy of “Consumer Credit File Rights Under State and Federal Law” that lets you know that you can pull the credit report and can dispute any wrong information on the reports.
5. Can I repair credit on my own?
Yes, you can repair credit on your own. First of all you need to avoid tempting ads that promise to reduce the chances of being a victim of the credit repair scams. If you try to repair your own credit, then you’ll have to pull your credit reports and review on a regular basis. If you find any wrong listings, then dispute these off your credit reports by negotiating with the credit bureaus as early as possible.
Remember, the negative items will stay on your credit reports for 7 years. However, if you can pay off your financial obligations, then you can also take the advantage of PFD and Goodwill letters. The PFD or Pay for Delete is one of the most effective option through which you can get the negative listings or errors removed from your credit reports. All of these steps will help you to build your credit with time as well.