How to Spot Credit Repair Scammers and Get the Real Deal

Written By Mary Beth Eastman
Last updated April 28, 2020

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Credit
March 28, 2018

Simple. Thrifty. Living.

Having a good credit score benefits many parts of your life. You’ll be more likely to get approved for an apartment lease or mortgage, receive more appealing interest rates on loans and credit cards, and have lenders competing to work with you.

The good news about credit is that even if yours is in the dumps, recovery is possible. Working with credit repair companies like Lexington Law Credit Repair or Credit Saint is one way to improve your score. You just need to make sure you’re not falling for a scam — unfortunately, scam artists target vulnerable people looking to improve their credit. Here are three red flags to look for.

Per the Credit Repair Organizations Act, credit repair companies are not allowed to ask for payment until they’ve delivered services. If the company contacts you over the phone, the federal Telemarketing Sales Rule may also apply. When that is the case, the company must provide you with a credit report after six months of providing their service that shows improvement before they can charge you. In short: If you’re asked to pay before you see results, run the other way.

A reputable credit repair company like CreditRepair.com (see our CreditRepair.com review) or Sky Blue Credit Repair (see our Sky Blue review) will advise you of your rights up front. Your contract should outline your relationship with the company and which results, if any, are promised. A good company will never ask you to waive your rights. If the credit repair organization you’re considering is dodgy about what your rights are or asks you to sign them away, take it as a bad sign.

A credit repair company can do a lot of good things. They can aid you in the removal of incorrect information and may be able to advise you on best practices. What they won’t be able to do is remove correct information, even if it’s negative. Any company that sells you on obtaining a perfect credit score in a few months should be viewed with some skepticism.

Cleaning up your credit is easier with the help of a professional counselor, but make sure you’re dealing with the real deal. Check for these red flags before you sign a contract. If you still need more information, review our list of the most reliable credit repair companies.

About the Author

Mary Beth Eastman

Mary Beth Eastman serves as the content manager for Simple. Thrifty. Living, where she is dedicated to helping readers use money and credit wisely. Mary Beth believes that access to the right financial information paired with a growth mindset are essential tools for getting out of debt and building wealth. Mary Beth has a degree in Journalism from Bowling Green State University and has focused her 20-year journalism career on putting readers front and center, carefully considering their concerns and presenting information that will help them in their everyday lives. She has won numerous statewide journalism awards. Her writing on personal finance as been featured on numerous websites in addition to Simple. Thrifty. Living, including Huffington Post and Lexington Law blog. Mary Beth resides in Pittsburgh, Pa., with her family and two rescue dogs.

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