They're everywhere - on the Internet, on TV, on magazines and newspapers - and they claim they can solve your credit problems in a snap. Don't fall prey to these scam artists. These companies claim that by removing actual credit information and changing what's on there, they can improve your credit, and even claim that they are the only company that can offer such services. Don't believe their hype.
Don't be fooled by credit repair companies asking exorbitant sums of money in exchange for them repairing your credit. They may sometimes offer to pay you your money back should they not succeed, but in any case, stay away from these companies.
Disguising Your Bad Credit With A New Identity
People who have filed for bankruptcy would usually be approached with a "file segregation" offer, the most popular term used by credit repair fraudsters. Here, you are promised a chance to hide unfavorable credit information by establishing a new credit identity. It IS too good to be true. File segregation is illegal. You could end up in jail or have to pay hefty fines for this.
Other Scams
Consumers looking for an easy fix often are targets of these other credit-related scams.
First, we have credit by phone. Pay-per-call or 900-number services have become a popular vehicle for credit scams. They would promise a sure source of credit or cash if you call the 900 number in question. Instead, the caller might only receive a list of banks offering low-interest credit cards or a booklet on how to establish credit - and a phone charge of $50 or more. Obviously, it's not a good way to establish credit.
You can also be scammed with a credit card offer. Beware of promotions for gold or platinum cards that promise to get you credit and build your rating. Although they may sound like all-purpose credit cards, some cards only permit you to buy merchandise from special catalogs and will not help you obtain other credit. And for a giveaway clue that these cards aren't for real - they will make you call a 900 number to get customer service or additional info. These phone charges add up quickly.
Finally, be wary of the checking account scam. You would first get a postcard that promises you fast credit card approval and low interest. When you call, you are asked for your checking-account number as "verification." Your number then can be magnetically encoded on a draft, which is forwarded to your unsuspecting bank for payment from your account.
Be vigilant about these exploitative scams and file a complaint with the Consumer Protection Hotline, or fill out an online form with the Attorney General's Office. Don't make the mistake of sharing your personal information with companies you don't, and shouldn't trust. This way you could avoid credit card repair scams.
Don't be fooled by credit repair companies asking exorbitant sums of money in exchange for them repairing your credit. They may sometimes offer to pay you your money back should they not succeed, but in any case, stay away from these companies.
Disguising Your Bad Credit With A New Identity
People who have filed for bankruptcy would usually be approached with a "file segregation" offer, the most popular term used by credit repair fraudsters. Here, you are promised a chance to hide unfavorable credit information by establishing a new credit identity. It IS too good to be true. File segregation is illegal. You could end up in jail or have to pay hefty fines for this.
Other Scams
Consumers looking for an easy fix often are targets of these other credit-related scams.
First, we have credit by phone. Pay-per-call or 900-number services have become a popular vehicle for credit scams. They would promise a sure source of credit or cash if you call the 900 number in question. Instead, the caller might only receive a list of banks offering low-interest credit cards or a booklet on how to establish credit - and a phone charge of $50 or more. Obviously, it's not a good way to establish credit.
You can also be scammed with a credit card offer. Beware of promotions for gold or platinum cards that promise to get you credit and build your rating. Although they may sound like all-purpose credit cards, some cards only permit you to buy merchandise from special catalogs and will not help you obtain other credit. And for a giveaway clue that these cards aren't for real - they will make you call a 900 number to get customer service or additional info. These phone charges add up quickly.
Finally, be wary of the checking account scam. You would first get a postcard that promises you fast credit card approval and low interest. When you call, you are asked for your checking-account number as "verification." Your number then can be magnetically encoded on a draft, which is forwarded to your unsuspecting bank for payment from your account.
Be vigilant about these exploitative scams and file a complaint with the Consumer Protection Hotline, or fill out an online form with the Attorney General's Office. Don't make the mistake of sharing your personal information with companies you don't, and shouldn't trust. This way you could avoid credit card repair scams.
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