Scams are everywhere, and they can help bring down the public image of an entire industry. It is happening now with credit repair agencies. The Better Business Bureau (BBB) is cautioning consumers to keep a lookout for credit repair scams. While your credit score matters when it comes to buying a car, home, or even getting a job, you need to heed with caution any business that contacts you in efforts to repair your credit score.
Legitimate credit repair merchants will not typically “cold call” people in efforts to find business. There are signs that you can look for in order to tell a scam from a legit business. First off, a legitimate credit repair business will not ask a customer to pay for their services in advance. In the United States and Canada, credit repair agencies can only collect their fees after their services have been performed. Any “cold caller” that wants a money order or Greendot Card payment should be quickly hung up on and reported to your local police department.
Another misnomer is that a credit repair agency can remove negative info from your credit report. This is false, and it is something that fraudsters promise in order to scam. If the negative information is correct, there is no way to remove it from your credit report until the time limit is up for it showing. For example, a Chapter 7 bankruptcy will show up for 7 years, and there is no way to remove it before those 7 years are up, regardless of what the fraudsters tell you.
Another trick – and perhaps the most dangerous – is telling customers to use a new “credit identity”. Some fraudsters will tell customers to apply for an Employer Identification Number (EIN) instead of using their Social Security number when applying for credit. This is illegal, as it is a crime to misrepresent your Social Security number.
So, what can you do if you are a legit credit repair agency? The best thing that you can do is to steer clear of “cold calling” for customers, as well as investing in a good credit repair merchant account, like the one offered by EMB. This can help protect you and your business, in the case that anything may arise.