Everyday,
companies target people who have poor credit histories with promises to
clean up their credit reports so they can get a car loan, a home
mortgage, insurance, or even a job – after paying a fee for the
service. The truth is that no one can remove accurate negative information from your credit report. It's illegal.
What You Need to Know
When
negative information in your report is accurate, only the passage of
time can assure that it will be removed. A consumer reporting company
can report most accurate negative information for seven years and can
report bankruptcy information for 10 years.
If you get an
offer to repair or fix your credit, how can you know if it’s legit?
Here are some signs that should set off alarms in your head – and make
you put the offer in the trash:
The company wants you to pay for credit repair services before they provide any services.
Fact:
Under the Credit Repair Organizations Act, credit repair companies
cannot require you to pay until they have completed the credit repair
services they promised.
The company doesn’t tell you your rights and what you can do for yourself for free.
Fact:
The law allows you to ask for an investigation of information in your
file that you dispute as inaccurate or incomplete. This investigation
doesn’t cost any money.
The
company recommends that you don’t contact any of the three major
national consumer reporting companies (Equifax, Experian, and
TransUnion) directly.
Fact: Under the Fair Credit
Reporting Act (FCRA), the consumer reporting company and the
information provider (the person, company, or organization that
provides information about you to the consumer reporting company) must
correct inaccurate or incomplete information in your report. To take
advantage of all your rights under the FCRA, contact the consumer
reporting company and the information provider in writing.
The
company tells you they can get rid of most or all the negative credit
information in your credit report, even if the information is accurate
and current.
Fact: Any credit repair
company that claims to be able to legally remove accurate and timely
information from your credit report is lying. There’s no easy fix for
bad credit. Improving your credit takes time and a conscious effort to
pay your debts.
The
company suggests that you apply for an Employer Identification Number
to use instead of your Social Security number so you can invent a “new”
credit identity – and then, a new credit report.
Fact: If you follow illegal
advice like this, you may find yourself in hot water. It’s a federal
crime to lie on a loan or credit application, to misrepresent your
Social Security number, or to get an Employer Identification Number
from the Internal Revenue Service under false pretenses. You could be
charged and prosecuted for mail or wire fraud if you use the mail,
telephone, or Internet to apply for credit and provide false
information.
