Ripoff Alert #9 – Credit Repair Edition

The Ripoff Alert is a new series appearing once each week on Fridays. It alerts you to the latest scams and ripoffs trying to get between you and your money, and gives you information you need to stay safe.

Credit Repair

It seems like every time I watch late night TV, the ads for these outfits appear in droves.

You’ve heard the pitch: In exchange for a fee, they promise to remove the black marks from your credit report.

There are several variations: “We can raise your score 200 points in just weeks!” or “We can settle your credit card debt for pennies on the dollar!” There’s also the one about reducing the amount you owe to the IRS.

There are hundreds of organizations making promises like this, but they all have one thing in common: They’re just trying to rip you off.

The Federal Trade Commission is actively trying to shut down these criminals. But their efforts are mostly in vain because as soon as one is taken down another one pops up to replace it.

The truth is, repairing your credit takes time. Not weeks, but months and often years depending on what you have going on.

Don’t be fooled by these scam artists who try to get you to believe your credit can be repaired in the snap of a finger.

Here are three things you can do yourself to raise your credit score:

1. Pay every bill on time (35% of your score)

2. Don’t use more than 30% of your available credit (30% of your score)

3. Keep accounts open after you’ve paid them off (15% of your score)

Consistently doing these things will start improving your score in as little as 6 months.

Bonus tip: Use Credit Karma to watch your progress and monitor your credit score as often as once a day.

7 thoughts on “Ripoff Alert #9 – Credit Repair Edition

  1. The tough part about avoiding this scam is that people assume that if something is on tv they must be legit. They assume that someone else is checking up on these companies before letting them promote their stuff on tv. Really though it’s just a big reminder about how much cash they are raking in with this scam.

    • Right! Just about anyone can get an ad on TV. Nobody is monitoring the truth of claims made in ads, so it’s up to us to educate ourselves. It’s important that we’re able to weed out the false claims and avoid common scams like this.

  2. I’m not sure how anyone can “fix” your credit anymore than they can go back in time and get you good grades, etc. I’m thankful I’ve never had to be in the position where I was desperate enough for something like this. Scammers prey on the weak!

    • Yes, they do! If there are legitimate errors on your credit report, you have the right to challenge them with the credit bureau and have them removed. But items that are accurate, no matter how much you may not like them being there, will have to be overcome with time.

  3. Thanks for mentioning Credit Karma! And you’re right, promises to “fix” your credit from credit repair companies are usually false. They can’t delete true information on your credit history. The tips you gave are spot on.

    • Hi, Bethy! Thanks for your comment. You all provide an excellent service over at Credit Karma. I wish more people knew about the tools available to them when they’re attempting to repair their credit. I think some people are enticed by the promise of easy credit repair offered by these scammers. The truth is, only paying your bills over time will repair your credit.

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