Credit Score Improving Your Score

How to Avoid Credit Repair Scams Online

Elizabeth Aldrich

When you’ve got a low credit score, it can be difficult to do…well, just about anything that adults do. It’s hard to obtain a loan or a credit card, making it difficult to make big purchases like a car. It can even be difficult to find a place to rent, and some employers even look at your credit report during the interview process.

It’s because of this that many people with less than perfect credit feel desperate. That desperation causes many online companies to prey on folks with low credit scores, offering them all kinds of services and scams they claim can miraculously repair your credit in no time.

Well, if it sounds too good to be true, it probably is. While there are certainly services out there that can help you improve your finances and build your credit, many of the services online offering to give you a credit 180 will take your money and run. Here are the top ways to spot a credit repair scam on the internet.

  • They make incredible promises.

Outrageous claims are almost never true, especially when it comes to repairing your credit. If a company tells you they can increase your credit score by hundreds of points instantly, or even in a matter of months, it’s probably not true. A legitimate credit repair service will be up-front and realistic with you about the time and diligence it takes to rebuild credit, even if you are using a credit repair service.

  • They make specific promises before speaking with you.

Credit building is personal. Everyone’s credit report is different. If a company promises you that they can improve your credit score by a certain amount or within a specific time frame before they’ve even spoken to you about your particular circumstances, they are probably lying. In fact, if they promise to raise your credit score by a specific number even after speaking with you, be wary. Credit building is not completely transparent, and it is impossible to calculate exactly how much your credit score will go up given a certain set of behaviors. Legitimate credit repair services may quote a range that your credit score will likely reach or promise that it will improve without being able to say exactly how much.

  1. You aren’t given the proper paperwork.

All credit repair agencies are required by law to go through a certain process before providing their services. They must give you a copy of the “Consumer Credit File Rights Under State and Federal Law,” which details your rights in regard to your credit report. They should also give you a copy of the contract to look over and sign before proceeding. Make sure you read it carefully. You should find in the contract the amount you agreed to pay and the services they agreed to perform, as well as the timeline for the services that you both agreed to. If they don’t give you these things, it’s probably a scam.

  • You’re asked to pay up front.

Credit repair services should never ask you to pay before they perform any services. In fact, it is illegal.

About the author

Elizabeth Aldrich

Elizabeth Aldrich

Elizabeth is a freelance writer and “digital nomad” specializing in small business, entrepreneurship, career advice, real estate, travel, arts, and culture. She’s written for outlets as varied as Rawckus Music and Arts Magazine, Itcher Entertainment, Sweden Tips, Houzz, Hometalk, JobHero, Tico Times, and Eugene Weekly. Thanks to a three-year stint in a travel job, a knack for mining great deals, and credit card churning, she has not paid for a single flight since 2012, despite her constant travels. You can find her on Twitter @LizzieAldrich or her website, www.elizabethaldrich.com.

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