Credit repair agencies are what they claim to be – the repair their own credit. As for you, it may be that you just sunk deeper into the debt trap.
The credit agencies were initially created to help consolidate your various credit card loans into a affordable monthly payments based on your income. This was one of the ways to get away from the high interest credit card rates where you ended up paying only the interest without impacting your principal amount.
It seemed that there was no way to get out the credit card trap till the credit repair agencies came along. They looked at your debts, calculated your income, paid off the credit cards and created a payment plan for you. Over the years you could pay off the loan and be debt free, with your credit history restored to a healthy status.
As the demand increased for credit repair services, some of scam companies and fly by night operators entered the market. They promised to make your credit history disappear, took hefty upfront fees, and vanished.
Here are some of the signs that these operators may be scammers. They need upfront fees before any service is provided. You legal rights are never revealed. They ask you not to contact credit reporting company directly. They suggest illegal methods like inventing a new identity or disputing all your information on credit report or even using your employer identification number instead of your Social Security number for a new credit report.
But there are many legitimate companies who do provide the Credit repair service. Before you sign a contract with such a company, make sure that they have a genuine name and address, service fees are spelled out, the services are clearly mentioned, and your payment terms and conditions are stated. Check with Better Business Bureau and search on the Internet for any negative feedback. If you ever have to take such a service, make sure that you are not getting into an even bigger financial disaster.
