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Credit ScamsAs credit issues rise and the economy dips, credit "repair" is seeing resurgence in popularity. An army of paraprofessionals such as mortgage brokers, financial planners, and yes—even attorneys, are competing to offer credit repair services. The lack of need for licensing or certification also attracts a number of scam artists. In many cases you can correct inaccurate information on your credit report through phone calls and letters to the bureaus. Information on how to grow credit and proper uses of credit are easily found on the Internet. Unfortunately there is a lot of misinformation available meant to capitalize on your ignorance of the credit system. If you choose to go with a credit repair service, it may be because you don't want to spend the time working on the task yourself, not necessarily because they have special expertise, connections or abilities. You know that most credit repair services can't do anything to fix your credit that you can't do yourself. You are trading money to buy a little of your time. When making a decision to go with a service be sure to avoid the many repair and credit building scams out there. There are so many companies that are trying illegal credit repair scams that the federal government responded with the Credit Repair Organizations Act. This law prohibits companies from making false claims about credit repair and makes it illegal for credit repair operations to charge you before they fully perform their services. The law also gives you the right to sue in Federal court to recover damages if you are a victim of a credit repair scam. Bogus credit repair companies draw upon bankruptcy court records to prey on potential clients. Some companies claim they are affiliated with the federal credit protection agency—it's not true. The federal government is in no way involved in credit repair activities (other than to regulate them). Credit repair scams are so prevalent; many states require that credit repair companies be bonded in the event of lawsuits by their clients. |
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