Recently, we have received a few calls from consumers checking up on businesses that have called them and claimed that they could “fix” the consumer’s credit score. Usually, they claim they can increase your score by removing negative information from your credit report. Before you pay for this service, here are a few things you need to know.
No one can legally remove accurate and timely negative information from a credit report. Credit repair firms often challenge all negative items in a credit report, and if the reporting agency can’t verify the information within a reasonable time period, the information is removed, but it may only be temporary. If the information is later verified, it will be placed back on your file.
Federal law allows for negative information to be reported in your file for seven years or ten years in the case of bankruptcy. The law does allow you to request an investigation of anything reported that you dispute as inaccurate or incomplete; however, there is no charge for this, according to the Fair Credit Reporting Act.
Also, remember, under the Act, that you are entitled to one free credit report a year from each of the three credit reporting agencies. You can obtain those reports from www.annualcreditreport.com or 1-877-322-8228. You are also entitled to a free copy of your credit report if you’ve been denied credit within the last 30 days.
If you decide to respond to a credit repair offer, the Indiana Department of Financial Institutions and your BBB suggest consumers beware of companies that:
- Want you to pay for credit repair services before any services are provided;
- Do not tell you your legal rights and what you can do, yourself, for free;
- Recommend that you not contact a credit bureau directly; or
- Advise you to dispute all information in your credit report or take any action that seems illegal, such as creating a new credit identity. If you follow illegal advice, you could be opening yourself up to prosecution for fraud.
If you are in need of financial counseling, you may wish to contact a non-profit organization such as Apprisen at 1-800-355-2227 or the National Foundation for Consumer Credit at 1-800-388-2227.
Finally, should you receive a call like this yourself, feel free to check the company out with your BBB by calling us at 812-473-0202 or by visiting our website.
