Be Aware of Credit Repair Scams

Those suffering from bad credit would obviously wish to have cleaner slates to show. There are various firms who offer this service to customers who are desirous of improving their credit reports. There are a lot of people with bad credit reports. Bad credit reports cause a hindrance to apply for credit further. This is because lenders want to assure themselves that in the case of giving you a loan, they get back the amount back from you. They take this assurity on the basis of what is reflected of your credit report. Obviously, a bad credit report is not the thing lenders are most eager to see. The urge to better their credit report is natural and sometimes necessary to make any future debts available.

The firms offering credit repair services do so under a law called Credit Repair Organization Act. What this law states is that organizations offering these services have to fulfill a few pre-declared obligations or requirements. Unless a firm fulfills these conditions, it is not authorized by federal authorities to offer credit repair services to the general population.

Seeing this urge in people to better their credit records, some criminal minded people have started scams under the name of credit repair services. To protect yourself from these kinds of people and organizations and not fall into the attractive webs they spin to lure clueless customers, you should check whether or not they fulfill the obligations set by federal authorities under the Credit Repair Organizations Act. Furthermore, there are a few signs that differentiate the genuine organizations from the fake ones. So, look out for these signs when you approach these people for credit repair services.

government-regulations

  • Those firms which are run by scammers do not allow the customer a copy of the Consumer Credit File Rights under State and Federal Law. They also do not let you obtain a copy of your report and your power to exercise and submit a dispute on inaccurate credit report information. These are the first signs of detecting a fake company. If you know all the above information, then you are well armed and educated which works against their purpose.
  • Scamming organizations are also different in the manner that they do not give the customer a chance to thoroughly read the contract which they are to sign. They may submit some other paperwork for the client’s signature. In case of the extra documents, they give the customer a chance to read the document thoroughly. But when it comes to the main documents they insist the customer sign immediately for some made up reason or the other. That way, the customer does not really get a chance to read what he is signing and what he is getting himself into.
  • Contracts of fake firms don’t mention information regarding fees, service charges and other expenses in a detailed or precise manner. Even if they mention this information, it is very vague and cleverly worded to put the customer at a disadvantage.
  • Fake companies ask customers to make payments upfront and do not inform customers in detail the reason behind making such sudden payments.

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