SCAM AWARENESSCredit repair scams
Credit repair scams target people who are struggling with bad credit and want a fresh start. A company promises to remove late payments, collections, or bankruptcies from your credit report, or even give you a brand-new credit identity. They charge a fee up front, then do little or nothing that you could not do yourself for free.
How this scam works
You see an ad, get a call, or receive a mailer promising a higher credit score fast. The company says it can remove negative items, even ones that are accurate and recent. They ask for a fee before starting work and may ask for your Social Security number, credit report logins, and bank details to "get started."
Some tell you to dispute every item on your report, even correct ones, or to stop contacting the credit bureaus yourself. Others suggest you apply for credit using a new number they provide, which is illegal. After you pay, the company may stop answering, or it files a stack of disputes that do not stick. Your accurate negative items come back, and your money is gone.
What it can look like
EXAMPLE · NOT A REAL MESSAGE"Tired of bad credit? We guarantee a 100-point jump in 30 days and will wipe out collections, late payments, even bankruptcies. Just pay the $499 enrollment fee today and send us your credit login. Spots are limited. Sign up at [link]."
Warning signs
- They demand payment before doing any work.
- They promise to remove accurate, recent negative information.
- They guarantee a specific score increase.
- They tell you not to contact the credit bureaus yourself.
- They suggest using a new identification number to get credit.
- They do not explain your legal rights or give a written contract.
How to protect yourself
- Know that federal law bars credit repair companies from charging you until they finish the promised work.
- Get free copies of your credit reports at AnnualCreditReport.com, the official site for free reports.
- Dispute real errors yourself directly with the credit bureau and the business that reported them.
- Never use a different Social Security or identification number to apply for credit.
- Ask for a written contract and read it before signing. You have three business days to cancel.
- Consider a nonprofit credit counselor for free or low-cost budgeting help.
If you already responded
- If you paid by card, call your card company using the number on your card and ask about disputing the charge.
- Send the company a written cancellation notice and keep a copy.
- If you gave your Social Security number or credit logins, change your passwords and consider a credit freeze.
- Check your credit reports for new accounts or changes you did not make.
- Report the company to the FTC, the CFPB, and your state attorney general.
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Where to report it
Common questions
Can a credit repair company remove accurate negative items?
No. Nobody can legally remove accurate, current negative information from your credit report. Late payments, collections, and bankruptcies that are correct generally stay on your report for a set number of years. A company that guarantees otherwise is making a promise it cannot keep. Only items that are wrong or outdated can be corrected.
Is it legal for credit repair companies to charge upfront fees?
Under the federal Credit Repair Organizations Act, credit repair companies cannot require payment before they have completed the services they promised. They must also give you a written contract and let you cancel within three business days. A company that demands money first is a strong warning sign.
Can I fix errors on my credit report myself?
Yes, and it is free. Get your reports, then file a dispute online or by mail with each credit bureau showing the error. Include copies of any proof you have. Also contact the business that reported the wrong information. The bureau must generally investigate and correct information it cannot verify.