Scam alert! Around this of year, after all the holiday spending, you will see advertisements for credit repair.  But some of these so-called credit repair companies are nothing but scams and should be avoided.  Here are some tips on what to look for:

Do not pay anything until AFTER any promised credit repair services are FULLY COMPLETED.  Under the law (specifically, the Credit Repair Organization Act), a credit repair organization cannot charge or receive money for services before such services are performed.  No deposits, no monthly payments, NADA, until the job is done!  If they ask for payment, cancel the service contract and avoid the company.

You should have a WRITTEN CONTRACT with any credit repair company, PLUS the contract has to give you a 3 DAY RIGHT TO CANCEL.  Do not do anything with a credit repair company over the phone.  The contract should also state the cost, a time estimate for completion, the payment arrangements and exactly what they intend to do with each account.

Finally, you should know that it is very unlikely credit repair organizations can remove accurate credit information and judgments from your credit reports.  If there is inaccurate or incorrect information on your credit report, the three main credit reporting agencies, TransUnion, Equifax and Experian, all provide a dispute or correction process that you can handle on your own.  So don’t waste money on a credit repair company when you can get the same results by yourself for free.

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