Are you urgently looking for a way to quickly improve your credit score and fix any past financial mistakes jeopardizing your creditworthiness? If so, hiring a credit repair agency might be the best solution.
While it’s possible to boost your credit score by yourself, enlisting a credit repair company to help can save you a lot of hassle and time. It also never hurts to get the input and expertise of professionals when undertaking something as important as fixing a tarnished credit rating.
Even so, not all credit repair companies are equal. The demand for credit repair services in the past few years has led to many charlatans and scammers invading the industry, making it harder to distinguish legitimate agencies from dubious ones. For this reason, it’s important to keep your eyes open and look out for potential red flags when shopping for a credit repair agency. Otherwise, you’re at serious risk of getting duped and potentially hurting your credit score further.
Here are five warning signs you pay attention to when choosing a credit repair service:
They Pressure You to Pay Upfront
One of the biggest indicators that a credit repair company is shady and untrustworthy is if they ask you to make payment upfront. Some disreputable agencies even demand payment before they’ve had a chance to look at your credit score or provide any services.
Under the Credit Repair Organizations Act, it’s illegal for credit repair agencies to ask for or receive payment until they’ve delivered the services they promised the client. Most credit repair agencies typically bypass this regulation by scheduling monthly payments. Whatever the case, you should avoid companies that insist on upfront payment, no matter how great the deal might seem.
No Scope of Work – Only Promises
When you’re desperate to improve your credit score, you’re likely to fall for any credit repair agency that promises to deliver the results you’re looking for. Unfortunately, this can leave you vulnerable to unscrupulous companies eager to capitalize on your desperation. For instance, they may promise to raise your credit score by a specific figure or remove all negative credit items from your credit score in a short amount of time.
The truth is, there are no quick fixes when it comes to repairing a tarnished credit record, and there are certainly no guarantees. So, agencies that make inflated promises should automatically make you look for other options.
No Clear Line of Communication
Fixing your credit score is a big financial step that requires a strategic and well-informed approach. It’s your right to have all your questions answered in a satisfactory manner before engaging with any credit repair agency.
In fact, when you compare the top credit companies, you’ll notice they place a huge premium on transparency and are forthcoming with answers to client questions. They genuinely desire to help you and want you to feel confident working with them.
As such, any credit repair company that seems unwilling or unable to answer your questions should set off warning bells. If a company isn’t forthcoming with answers to your questions, there’s a good chance they’re trying to hide something.
Their Methods are Suspect
Granted, credit repair companies are not obliged to share their trade secrets as long as they operate within a legal framework. Regardless, you should be wary of agencies whose mode of operation comes off as sneaky.
For instance, some dubious organizations may ask you to create a new credit identity. Others may even try to compel you to contest up-to-date and accurate information on your credit report.
These are serious federal crimes that can get you prosecuted for fraud, even if you aren’t aware of the legality and were ignorantly following the advice of a credit repair company. For this reason, you should always stay alert for such advice, and don’t hesitate to walk away if your gut tells you something is off about an agency’s methods.
They Don’t Inform You about Your Rights
A reputable credit repair company typically wants you to be well-informed of your rights and what you can do to empower you in your decision-making. Consequently, any credit repair agency that seems to withhold this information should raise suspicion.
Under the Fair Credit Reporting Act, you have a free legal right to dispute erroneous items in your credit report, so you don’t have to pay an organization to do it for you. Likewise, you can cancel any agreements with a credit repair agency within three business days of the agreement being signed at no cost.
