| Beware of Credit Card Repair Scams |
Credit Repair: Beware of Scams
The Warning Signs
If you decide to respond to a credit repair offer, watch for these signs of a possible scam:
- Companies that want you to pay for credit repair services before they provide any services. Don't.
- Companies that do not tell you your legal rights and what you can do for yourself for free.
- Companies that recommend that you not contact a credit reporting company directly. This should throw up a red flag.
- Companies that suggest that you try to invent a new credit identity and then, a new credit report by applying for an Employer Identification Number to use instead of your Social Security number. Again - red flag!
- Companies that advise you to dispute all information in your credit report or take any action that seems illegal, like creating a new credit identity. If you follow illegal advice and commit fraud, you may be subject to prosecution.
You could be charged and prosecuted for mail or wire fraud if you use the mail or telephone to apply for credit and provide false information.
It is a federal crime to lie on a loan or credit application, to misrepresent your Social Security number, and to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses.
Under the Credit Repair Organizations Act, credit repair companies cannot require you to pay until they have completed the services they have promised.
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