Beware of Credit "Repair"

Be wary of anyone claiming that they can get current accurate information on your credit report deleted.  Information can only be deleted from your credit report if it is inaccurate (i.e. not yours) or if it is obsolete, which usually means a derogatory item that is more than seven years old. Lately, I have seen a lot of ads on the internet promising to "repair" your credit by having accurate, current information removed from your credit report.  This simply does not happen and is, at best, a waste of money and, at worst, a scam.

Some of the ads I have seen for credit "repair" are obviously untrustworthy.  For instance, I keep getting Craigslist ads in my Google alerts for credit repair.  You should always beware anything on Craigslist but even more so when it involves a service that sounds too good to be true. These ads are clearly suspect and are easy to avoid.

Other ads are a bit slicker, like the ones for so called law firms in the credit repair business. From my experience from potential clients who seek to hire me after one or more credit repair law firms fail to help them (after taking a lot of their money, of course), the disputes lodged by the credit repair "law" firms look like they are written by a toddler with a thesaurus, using long words that sound impressive but make no sense in the context they are used and, as a result, are not even likely to get an error deleted, much less an accurate item.  From what I have been told, the credit bureaus routinely ignore disputes from known credit repair law firms since they dispute all derogatory items, not just the erroneous items, and thus have little or no credibility left with the credit bureaus.  

Do not fall for these scams.  If you want an actual error corrected on your credit report, contact the Kittell Law Firm in Hernando, Mississippi and we will be glad to assist you in correcting your credit reports.  Not only will we do our best to get your credit report corrected, if a violation of the Fair Credit Reporting Act has occurred, we will seek compensation for you as well.  Unlike credit repair "law" firms, we try to put money in your pocket, not take it from you.

The Truth About Credit Repair Companies

I am often asked what the deal is with credit repair companies.  Can they really remove derogatory but accurate credit history from a person's credit report.  The short answer - NO!!!  So, all of you out there, quit paying money to these companies to "fix" your bad credit.  Instead, use that money to pay your debts and get your own self out of the hole that you unfortunately find yourself in.

Apparently, I'm not the only one being asked this question.  Below is a link to an article on foxbusiness.com regarding credit repair companies.  Their advice mirrors mine.  Here's the link - http://www.foxbusiness.com/economy/2012/06/18/is-there-legit-company-to-fix-my-credit-score/

No Need for Credit Repair Companies

All I've got to say in response to this article is AMEN!!! Check out what I'm talking about here --> http://rapidcityjournal.com/business/your-credit-resource-you-can-correct-errors-on-your-credit/article_aa159bf8-bb40-11e0-bb72-001cc4c03286.html

Another Credit Repair Company Sued

According to a lawsuit filed by Colorado Attorney General John Suthers, a “credit repair” company has clearly violated federal and Colorado law by charging upfront fees and failing to disclose the total cost of its services.
The suit was filed in Denver District Court against Veracity Credit Consultants, a credit repair company that charges consumers initial fees of up to $99, and subsequent monthly fees as high as $79. Colorado law prohibits credit repair companies from charging fees until their services are complete.
The credit repair company of questionable character boasts of “results” and claims to be one of the best credit-repair outfits available.
According to the Colorado Attorney General, many of the company's claims are exaggerated at best. He specifically pointed to the company's claim that it can “optimize” consumers' credit reports by repairing or erasing bad credit as worthy of suspicion. Both the federal Fair Credit Reporting Act and Colorado Consumer Credit Reporting Act provide that credit bureaus can continue to report negative information about a consumer's credit for up to seven years.  Veracity's claimed tactics apparently fly in the face of the FCRA and Colorado's Consumer Credit Reporting Act.

Veracity's website says that the company “uses knowledge of the law and years of experience perfecting a proven formula to provide results while protecting your rights.” Once a consumer opens an account, according to the site, Veracity “investigates and works with credit bureaus and creditors” and works “to remove errors, delete negatives, and highlight good accounts.”
Despite these impressive claims, Veracity's “client-services agreement” explicitly says that the company doesn't “represent or warrant that it will achieve specific results for client.”
I have yet to meet a credit repair company that is above board.  Credit repair companies that are willing to try to remove accurate, non obsolete information from a consumer's credit report for a fee simply fly in the face of the entire credit reporting system and hurt those consumers who do pay their bills.  Just as strongly as I feel that credit bureaus should correct errors on consumers' credit reports, I also believe that consumers should have to live with their legitimately bad credit for the seven years that the FCRA allows the reporting of adverse credit items.  Credit repair companies are shady at best and those consumers who try to skirt the rules by using credit repair companies are, in my opinion, questionable as well.

California Attorney General sues executives of credit repair company

Hats off to California Attorney General Jerry Brown.  Brown has filed litigation against Todd Swick and Michael Sardo who own Executive Financial Credit Services, a credit repair company.  California passed a law in 1984 that requires credit repair companies to register with the California Attorney General's office and post a bond with the California Secretary of State. 

Apparently, Executive Financial Credit Services has failed to do both, despite repeated warnings from the Attorney General's office.  The litigation was filed in San Diego Superior Court on September 30, 2009.  Brown wanted to send "a clear signal to credit repair firms operating in California that they must register .... and follow the law.

Credit repair companies that are paid by consumers to attempt to repair consumers' credit by disputing negative information on the consumers' credit reports.  Many credit repair companies are nothing but scams.

Tips on improving your credit score

While I don't agree with hiring a credit repair company to fix your credit, since most are scams, I do agree with the rest of the advice in this article by someone (the article doesn't identify who) that works for or owns a credit repair company. Here's the advice I do agree with:

"Beware of Store Cards

Department stores love to push their credit cards by offering a discount on your purchase if you sign up on the spot. This can be a good deal. But it is handy to know that store cards create triple trouble on your credit report. First, your score will be reduced because of the inquiry. Second, your score will be reduced because of the new account that will soon appear on your report. And third, store cards tend to give a low credit line, often just above your purchase amount. This can be terribly damaging as the FICO credit scoring model puts a lot of weight on the relationship between your balance and your high credit limit.

Watch That High Limit

I run a national credit repair company and speak to people all day long about their credit reports. One of the bits of advice that we like to offer our customers is to pretend they only have half the limit on their credit card that they really have. It takes some discipline to do this but it can make a big difference on your credit score. As soon as your balance exceeds fifty percent of your available limit your credit score will start to suffer. If your credit balances are currently close to your credit limits you might consider calling the credit card companies and asking them to increase your limit. You will be amazed at how fast this can make your score go up!

The Auto Shopping Credit Trap

I can’t tell you the number of times that we have looked at a credit report and seen multiple auto credit inquiries. When we ask our customer they inform us that they only went to two different dealers. Auto dealers will often shop for the best interest rate for you. If they shop with three auto finance companies you will have three credit inquiries. These multiple inquiries can have a significant impact on your score. This is not the auto dealers fault. After all, they are acting your best interest, but it is best to be aware of the possibilities. If you are shopping for a car I would suggest not providing your Social Security number until you are settled on the car you want.

[Ok, I don't agree with this one because I have been told numerous times by representatives of the credit bureaus and those (like me) that sue the credit bureaus often that multiple inquiries arising from a possible auto purchase are treated as one inquiry and thus do not overly affect your credit score.]

No More Mr. (or Mrs.) Nice Guy

Just about every day in the credit repair business we come across someone that was nice enough to co-sign for someone on a car loan. I’m sorry to say this, but chances are that if they need you to co-sign they will not make their payments on time. And this will kill your credit scores. I know that this is a tough call. It is hard to say 'no'. If this situation arises in your life I suggest an alternative approach. Go ahead and co-sign. But when the payment book arrives ask them to give it to you. Have them pay you instead of the auto finance company. You will make the payments on time. And maybe they will feel some extra obligation to make their payments to you on time as opposed to some anonymous auto finance company.

Don’t get complacent

Check your credit from time to time. In December of 2003 Congress passed the Fair and Accurate Credit Transactions Act (FACT Act) which, among other things gives you the right to get a free credit report from each bureau one time per year. This law was passed to protect you from the credit reporting errors that occur far too frequently. Don’t imagine that because you are doing everything right that the credit bureaus are reporting everything correctly. Get your reports and proof read them carefully. It’s your right."

To exercise that right, be sure to go to www.annualcreditreport.com as I explained here - http://fcralawyer.blogspot.com/2009/05/truly-free-credit-report.html. For the rest of the article about improving your credit score (even the parts I don't agree with), click here - http://www.firmenpresse.de/pressrelease2056.html.