How to Know If An Online Credit Repair Company is Legit

Published May 6, 2021 by WC Team

How to Know If an Online Credit Repair Company is Legit


Start With Understanding The Basics Of Credit Score

Your credit score reflects your creditworthiness. If you have a high credit score then you can get loans easily when needed and the interest rates are generally low. This will not only be for loans but also for insurance premiums, eligibility to rent a house, taking a car loan, and so on. Alternatively, when your credit score is low, you will not get a loan easily and your interest and premiums will be high. Landlords of an apartment too will not be too keen to rent their apartment to you. 

Your credit score can go low due to many reasons. You need to get your credit score in order as soon as possible as it is a vital part of managing your finances. If your credit history has been anywhere less than perfect for too long, then maybe it is time for you to approach a credit repair company. These organizations help consumers improve their credit scores. A nominal fee is charged for the service. They coordinate with credit bureaus and also other creditors on your behalf. If they find errors in your credit report, they also dispute them. All in all, these are professionals with years of experience and knowledge who have helped many people to improve their credit scores. 

That being said, whenever there is money involved, there is always a chance of being scammed. To say that all credit repair organizations are frauds is not justified. Many people have been able to improve their credit scores through such companies and have been able to access financial gains by increased credit limits. 

Below are some of the tell-tale signs to keep in mind so you know that the company you are approaching is a scam.

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They Ask You To Pay Upfront

While in many types of services, paying upfront is generally acceptable, that is not the case when it comes to credit repair service. Legit credit repair services online do not request fees upfront. The fees are applicable after they are able to help you with improving your credit report that reflects positive results. If the company pressures you to pay upfront before fixing the score and completing the services, then chances are that it is not legit. Some companies may offer structural monthly payments and avoid the requirement of paying upfront.

They Make Illegal Claims To Improve Your Score

While there are chances that there may be some errors in your credit score report, that is not always the case. Some of the negative marketing can be accurate and justified. If the company makes claims to remove negative information from your report even though it is accurate and justified, it is a warning sign that they are scamming you. This is because no one can remove such information when it is justified. The same goes for if they propose to dispute information that is accurate in your report. No information that is accurate and current can be disputed in your report. These are false promises made to lure you into using their services. 

They Do Not Explain You Your Rights

As a consumer, you have certain rights of what you can do and what you cannot. You can even correct some errors or fix minor problems in your report by yourself. When a company avoids telling you what your rights are or refuses to tell you small fixes that you can do by yourself, then that is an alarm sign. Disputing errors are free in most countries as that is your right. Also, some companies may force you to work with them after you have met them for consultation. They may pressurize you to pay them for only consulting them. As a consumer, you have the right to cancel your contracts within a few days if you are not satisfied with them without paying any charges. 

They Forbid You To Contact Credit Reporting Companies

When a company wants to be very secretive and denies you the right to cross-check any information with the officials yourself, then they are probably not legal. All credit repair companies on online platforms have to follow federal laws which prevent them from using deceptive practices or misleading the consumer. If the company is uncomfortable with you cross-checking the report made by them then the chances are the reports are not accurate and there is something that they want to hide. Steer clear from such companies.

They Make A Contract With Unclear Details

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A written contract that is signed by both parties can hold both sides by law to follow what is promised. It is very important to ask for a written contract from the company you are dealing with to ensure that all that is promised is delivered. If a company gives you a contract with unclear detail and information which doesn’t include the fees, the services performed, the time period required to perform the services, the details of the company itself, the cancellation clause, and so on, then you should refrain from signing it. Signing such a contract will only cost you the charges you have to pay and you will be frustrated with the waiting period as they can claim that they never promised you one. You must make sure that the contract given to you has all the information required and you have read all the fine print.

How to Select a Legit Company for Credit Repair Services

The online platform offers a plethora of options when you want to search for any services. Though it has the benefits of easy access to information, sometimes it can be misleading. Below are some tips that you can follow before approaching a company online. This way you have already researched properly and will be more confident about finalizing a company before taking their services. 

Check Their Reviews Online

Where companies have the power to illegally establish themselves and manipulate victims, the consumers too have the power of writing reviews and speaking against scams they have encountered. You can do a quick research online and check if the prospective company has any complaints against them. Various platforms give honest and legit reviews. You will be able to see how like-minded people like you felt about the services received from the company and if their claims are true or not. 

Check The Source

Look carefully at how you came across the company profile while searching on the internet. Illegal companies advertise online through cheap websites and promise to work miracles with your credit score. At the same time, credible companies are often sourced through reputable sites and are also referred by banks, financial institutions, and other notable organizations. You can also check if the website is legit by checking their SSL certificate or by running a check online for the same. Check if the company has mentioned all their details on their webpage and does not appear to be working anonymously. 

Check Their Credentials And Accreditations

Reputable companies have a history which you can easily check on the internet. While scammers come and go by constantly changing the name of their company, reputable ones stay for long. Check the address and contact numbers of the company to see if they have reported the same business activity from different websites with different names. You can also check to see if they hold the necessary legal accreditations. These accreditations are offered to companies through trusted legal entities when they follow the industry standards and have gone through the proper training needed. 

What to Do If You Have Been Scammed By A Credit Repair Company 

Sometimes, no matter how many precautions you take, you can be victimized by the scammers online and fall prey to their false claims. In such scenarios, don’t despair. Don’t let them get away with the scam and take action against them. You can report to your local authorities about the same and also hire an attorney to represent you. You can visit or get in touch with the consumer protection bureau if you feel that your right has been violated. While this may not help with repairing your credit, you will at least be able to get back the money that you lost to the scammer. 

Many people do not report fraud as they feel embarrassed about it. This just gives the scammers more chances to go ahead and scam others. Collect all the information you have on the company like emails, documents shared, details of any financial transaction, and file a case against them.

One thing to remember is that not all credit repair companies are scammers. Some of them work with honesty to help the client win back their credit score and help them towards a better financial life. While they can help you in many ways, you too can help yourself. Be alert and informed about your credit transactions and do a monthly check on them so that you don't get any unpleasant surprises after a few months. A little extra effort from your side can help you ward off a lot of problems in the future. 

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