First of all, there are many companies all over the Internet and other places that claim they can erase all your credit worries. But one must be extremely aware. Unfortunately for the consumer, not all these companies are legitimate. The companies may end up making things worse and do absolutely nothing to help the person in need. So make sure to do all the research before giving your money to any unknown company claiming they can repair your credit. If you really want to use a credit service to repair your credit, try to find a plan in which payment is only required when services are completed and results are obtained.
The Credit Organizations Act protects people from faulty credit repair organizations or services. Regarding so called credit repair companies that ask for a payment upfront, it states, “No credit repair organization may charge or receive any money or other valuable consideration for the performance of any service which the credit repair organization has agreed to perform for any consumer before such service is fully performed.”
Under this act, one should also take time to note that neither the company nor the client has the right to remove any information from the person’s credit report that is accurate and less than seven years old. Another related factor to consider is that bankruptcy can be included on one’s credit report for up to ten years.
A bad credit report is not automatically a sign that you will never get credit. For example, a company may look at your last few years of credit history and, if it has been steadily improving, they may give you the credit.
If you need help to sort through everything and to get back on track, the most helpful person is yourself, according to the Federal Trade Commission. The FTC suggests starting with getting in touch with you debtors and letting them know that you are currently unable to pay. See if some type of plan or another option could be worked out. There are also many local credit counseling services that can help if you needs aid to work out a payment plan and a budget for your expenses. Every state offers services to consumers through non-profit organizations for little to no cost.
One should also be aware of any and all rights they have in such matters. Another act that protects consumers is the Fair Credit Reporting Act. Under this act the consumer has the following rights:
- One is allowed a free copy of his or her credit report if he or she has been denied credit, employment or insurance and the request is made in 60 days. This is also possible if one can prove they are unemployed and are planning to search for a job within 60 days, if one is on welfare, and if one’s was the victim of fraud and his or her credit report is therefore inaccurate.
- Another thing one should note is that no charge is applicable if one wishes to argue mistakes or out-of-date information in his or her credit report.
By Lauren Culliton