SolveYourProblem eLearning Series:
Help Me Improve
My Dreadful Credit Score
(
26 pages )
Credit
Score Tips
Tip # 37: It will be easier for financial
experts to help you if you seek credit repair help sooner rather
than later.
If
you do decide to seek credit repair help from the experts,
it makes sense to seek that help before your financial situation
spirals too far out of control. After all, credit repair
experts can do little for you if your credit and financial
situation is so bad that the only option left to you is bankruptcy.
Tip #38: Look out for credit repair
scams.
There
are a number of credit repair scams out there. These scams
often promise to help free you of bad credit, when in reality
the “experts” offering these services will either overcharge
you, involve you in illegal activity, or actually put you
in a worse financial situation. Look out for these most common
scams:
1)
Credit repair companies that tell you to lie on loan applications
or suggest that you develop a second identity. This is illegal
and dishonest. If a company suggests that you open accounts
in a new name or falsify your information on loan applications,
run, don’t walk, away.
You
can be charged with fraud for doing this - and you will be
held responsible for your actions, even if you were acting
under the company’s advisement. You certainly don’t want
to add legal troubles to your credit woes.
2)
Credit repair companies that charge you fees or hidden fees
for things you could do for free yourself - such as work
out a budget. Also be wary of companies that ask for money
up front.
3)
Credit repair companies that promise to pay your creditors
from money you pay to them and which they keep in an escrow
account. This is a common scam and it presents a huge problem
for the debtor.
Here’s
how it works: the debtor gives money to the credit repair
company, presumably for paying off debts. The company places
the money in an escrow account where it grows. The idea is
that the company will eventually pay off your debts when
the amount reached in the account matches the debts. The
problem is that in the meantime, the credit repair company
is removing some money from the account for administrative
fees while creditors are becoming more and more anxious,
increasing the interest on the debts and even starting legal
action against the debtor. This type of “credit help” can
actually ruin your credit rating!
4)
Credit repair companies that pressure you, don’t listen to
you, or want you to sign a contract you have not read. Such
companies are not to be trusted and should be left well enough
alone.
5)
Companies that offer you fast or instant credit repair -
no matter how bad your credit. This is simply a misleading
a claim that no company can legitimately deliver on. If you
have very bad credit, it may take years to fully repair.
In
many cases, these companies will claim that they can remove
your poor credit history from your credit report by disputing
it. This is false information. You simply cannot remove true
and accurate information from your credit report. It is true
that a credit bureau must investigate a claim of inaccurate
information within thirty days, but this does not mean that
the company will automatically remove the information.
In
fact, if the information is accurate, the data will stand.
Credit bureaus are aware of this common credit repair scheme
and have become very good at detecting it. Many credit repair
companies (and even some individuals) will try to dispute
every ding on a credit report, hoping that the backlog of
disputes will cause the credit bureau to automatically remove
the offending items from the report (the credit bureau is
legally required to remove disputed items it has not investigated
within 30 days). This technique is a scam and is dishonest
since you are not disputing inaccurate information.
Refuse
to do business with credit help companies that use this
practice.
6)
Companies that don’t tell you your rights or try to take
money for things you could do yourself. You can get copies
of your own credit reports and have the errors on them fixed
for free yourself - a company that does not tell you can
do this yourself ifs taking money form you for things you
can easily do yourself.
It
is a dishonest practice, and companies who follow such business
practices should be avoided at all costs.
Also,
if a company does not advise you of your credit rights, then
that is an indication that they are not really on your side
in the first place. Why would you want to do business with
a company that does not help you?
Tip #38: Get a good team on your side
to help you with your credit score.
A
good team of professionals can help you get your credit score
back in shape. Your most important member of your team is
yourself - you are the one with the financial agency and
(with this guide) the knowledge to become your own best advocate
in credit repair. Besides this, you may want to check with
your local library for financial help books. You may also
want to include financial experts such as credit counselors
or others to help you. If you decide to seek a team of experts
to help, be sure that you check each person’s credential,
standing with the Better Business Bureau, and past clients
to make sure that the person or company can really help you.
Beyond this, make sure that you sign a contract or agreement
with each professional member of your team.
Tip #39: Your bank has good and reliable
credit information.
One
free and professional source of credit information is your
bank. Your banking officer may be able to offer you a great
deal of professional, free advice, especially as banks are
trying harder and harder to provide good personal services
to customers.
Your
bank may also have a number of credit solutions - such as
overdraft protection - that can help you keep your credit
in good repair. Banks are realizing more and more that many
of their clients are dealing with less than ideal credit.
Banks are trying to meet the demands of this new group and
can actually be a powerful ally for those who are trying
to improve their credit.
 
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