BBB Sends Caution in Relation to Credit Repair Scams

Jun 17, 2015

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.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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