You see the ads everywhere, online, television, radio. FAST Credit Repair! Wipe Your Credit Report Clean! Eliminate Bad Debt From Your Credit Report!
Can it be true?
For people with bad credit, finding an easy way to get out from under a heavy debt burden is very tempting. But the sad fact is that the “fast” credit repair offers are usually just scams – designed to take your money and result in no better credit than before.
Some of the most common tactics are:
1. Claiming to “wipe your credit report clean”. This usually involves getting an employer ID, which the debtor then uses as their new social security number when applying for credit. This is completely illegal and fraudulent. It’s easily discovered by creditors, who have access to prior addresses, employment, and other information – and are not just looking at a social security number.
2. Claiming to get you immediate credit no matter how bad your credit score is. This too often involves getting a business line of credit based on an employer ID and not your personal social security number. The terms of these loans can be outrageous, if you even successfully qualify – many creditors still want you to see your personal credit!
3. Reducing the amount of your debt by 20, 30, 50% or more. The companies that agree to help you cut down your debt will often charge a huge fee for this service. Despite this, a debtor can often just do the same thing themselves – for free! – by contacting credit card companies themselves. These companies will negotiate with your lenders and credit card companies on your behalf, but you can say the same things when you contact your creditors. Also – while you might have lowered your debt, but the amount you’re not paying will show up as a “charge off” – meaning the bank didn’t collect it. This is a big a black mark on your credit report as any.
Be careful when applying for “fast” credit repair programs. Usually, you can do the same things on your own, without the hassle.