Credit-repair scams

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Credit Repair

Companies' promises to “fix” your bad credit rating or to erase your bad credit usually are nothing more than ways to take your money.

Business is brisk among these so-called “credit-repair” companies that charge $50 to more than $1,000 to fix your credit report. In many cases, these outfits take your money, do little or nothing to improve your credit report and then vanish.

There are no quick or easy fixes for a poor credit history. If a company promises to clean up your credit report, remember:

• Your credit history is maintained by private companies called credit bureaus that collect information reported to them by banks, mortgage companies, department stores and other creditors.
• Only time will heal a poor credit history - even if your problems were due to illness or unemployment.
• Credit reporting agencies are permitted by law to report bankruptcies for 10 years and other negative information for seven years. Any negative information may be reported indefinitely if you apply for:
  • $150,000 or more in credit.
  • A life insurance policy with a face amount of $150,000 or more.
  • A job paying $75,000 or more.

If there are genuine mistakes or outdated items in your report, you can fix them yourself - for free or for only a few dollars.

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