FEDS “bust” seven Credit Repair companies throughout U.S., charging them with deceiving consumers!
Warning: No credit repair company should promise you A+ credit!
Warning: No credit repair company should suggest they can score deletions on accurately reported bad credit accounts.
Reality: Credit repair companies try to fool people (not you though) into believing they can wave a magic wand and make your bad credit disappear.
Click Read More below for more information on avoiding the happy talk spreading like wild fire on the Internet about going to sleep tonight and waking up tomorrow with A+ credit.
TYPICAL CREDIT REPAIR PITCH
Daily, I hear from people who ask me about every credit repair company out there…or so it seems. Obviously, I have no experience with every credit repair company on and off the Internet.
However, I only have unpleasant experiences with credit repair companies. My real estate customers’ and I have searched for over 10 years to find an effective, legitimate & affordable credit repair company.
To date, I cannot recommend even one credit repair company.
So, I’m not surprised to hear about 7 companies getting charged by the Federal Trade Commission with deceiving consumers.
What does shock me is that I want to hear of charges filed against the BIG 3 credit reporting agencies: Experian, Equifax & Transunion). The Big 3 credit reporting agencies regularly violate the Fair Credit Reporting Act by “pretending” a valid dispute is frivolous…or incomplete…
And we know why the Big 3 do not want you or anyone else to improve your credit. But this post is not about the Big 3. It’s about credit disrepair companies leading you to believe you can pay for A+ credit.
The Federal Trade Commission has charged seven related companies with violating federal law by falsely promising to remove negative information from consumers’ credit reports, even information that is accurate and current, and by charging an up-front fee and failing to provide written disclosures. The agency seeks to make them stop the violations and pay restitution to consumers.
According to the FTC, the…
“…defendants [credit repair companies] charge consumers up to $2,000, including $300 in advance (emphasis added), promising to improve credit scores by removing information such as late payments, charge-offs, collections, inquiries, delinquencies, judgments, and accounts discharged in bankruptcy.
Apparently, these credit repair’ promotions include an ad on a third-party Web site stating, “100% Guarantee to raise your credit score!”
Mike Payne says: The problem with the statement is the word “guarantee”. Certainly, it’s not difficult to “…raise your credit score.” I believe my free CD 8 Secrets To A 680 Credit Score! will improve a person’s credit scores. Will you get to a 680? I don’t know, as results vary from credit report to credit report.
The FTC claims transcripts from telephone calls with consumers include the following deceptive and misleading statements about their credit repair services:
“I can’t tell you much because I’ll be giving you my trade secrets, but I can definitely guarantee that we’ll take care of anything that’s derogatory on her credit report. It’s all legal.”
Amazing, isn’t it? Doesn’t it sound too good to be true…that someone definitely guarantees he/or she will take care of anything derogatory on your credit reports?
My experience with credit disrepair companies is that they will ask you to note “inaccurately” reported bad credit accounts on your credit reports.
Yet, the CR company will dispute all bad credit accounts, firing off rounds and rounds of dispute letters, hoping to catch the bureau asleep and not able to verify within the 30-day statutory limit.
That’s their game plan.
The FTC alleges the:
7 credit repair companies charged with violating the Credit Repair Organizations Act misrepresented their services; charged in advance for credit repair services; and failed to provide consumers with written contracts and other materials that contain written disclosures required by law or deviated from the required wording for the disclosures.
More and more people are realizing they can’t pay their hard-earned money to a credit disrepair company and expect positive results, let alone A+ credit.
More and more people are realizing they don’t need A+ credit to get whatever it is they want from improved credit.
“The defendants are United Credit Adjusters Inc., doing business as United Credit Adjustors and UCA; United Credit Adjustors Inc., d/b/a United Credit Adjusters and UCA; United Counseling Association Inc., d/b/a UCA; Bankruptcy Masters Corp., National Bankruptcy Services Corp., Federal Debt Solutions Ltd., United Money Tree Inc., and Ahron E. Henoch, Ezra Rishty, and Gerald Serino, also known as Jerry Serino. The Commission vote to authorize staff to file the complaint was 4-0. The complaint was filed in the U.S. District Court for the District of New Jersey.
The FTC advises that only time, a conscious effort, and a personal debt repayment plan can improve your credit report. The first step is to learn what information is in your creditreport. If you find errors or mistakes, federal law gives you the right to have them corrected – free of charge. Federal law requires that the nationwide consumer reporting companies – Equifax, Experian, and TransUnion – provide you with a free copy of your credit report once every 12 months, if you ask for it. To order your free report, visit annualcreditreport.com, call 1-877-322-8228, or complete and mail the Annual Credit Report Request Form to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
source: http://www.ftc.gov/opa/2009/03/unitedcredit.shtm
Take a moment & look at the sentence in the last paragraph-- the sentence in bold print. Is the FTC this naive or just being funny?
“If you find errors or mistakes, federal law gives you the right to have them corrected – free of charge.”
Trying to get the Big 3 to report accurately is more challenging than it appears. Writing the dispute letter is (and should be) easy. Proving proof of inaccuracy is (and should be) easy.
What’s not easy is forcing the BIG 3 to clean up the accounts reported inaccurately. Going after credit repair companies misleading people about credit repair is a positive step. However, credit repair companies are a part of the problem.
What is your experience with credit repair companies and credit bureaus? Have you tried to dispute an inaccuracy before? What happened? The process of disputing should be very easy, provided you send your letter certified mail, return receipt requested.
- The bureaus should not try to trap people who type their letters or mail disputes from a different town/city, suggesting the letters are coming from a credit repair company.
- The bureaus should not label “frivolous” any dispute letter stating the account in question “is not mine.”
- The bureaus should not “verify as accurate” without confirming with the Furnisher. Going to a 3rd party database for “verification” is not verifying accuracy with the Furnisher.
Credit repair scams and misleading credit repair pitches and practices require the FTC’s intervention. However, the FTC also needs to investigate the Big 3 credit reporting agencies Experian, Equifax & Transunion for “verifying” inaccurately reported (and disputed) account information.
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