There is absolutely no need to hire anyone to improve your credit rating as you can easily do it yourself. However, if you are determined to hire a credit repair service, look out for these warning signs that it is a disreputable company.
1. "We guarantee results"
Congress passed a law years ago that forbids credit repair companies from guaranteeing their results. This means that no credit repair service can guarantee you that they can remove a bankruptcy notation or any other negative information from your credit report. Therefore, any company that tries to convince you that they can positively get the results you want, watch out, because they're not only breaking federal law; they're also fibbing, since no one can guarantee specific results.
2. A large lump sum payment is due upfront
Per federal law, a credit repair service cannot accept payment before work is done unless the company is a registered non-profit or operated by an attorney or CPA. Usually, the request for a large lump sum payment is a tip-off that you are being scammed. Odds are that the credit repair clinic will take your money and run off and you'll never see them again. A similar scam is the pay each month program where customers are asked to pay a specific amount each month "until your credit is improved". You can be sure the service is going to stretch out the process for as long as possible to collect as much as they possibly can from you -- you'll likely end up paying $800 or more for work you can easily do yourself as outlined in our credit kit.
3. Watch out for credit repair services or websites operate by attorneys and CPAs
Some attorneys and accountants have realized that they can make some quick, easy money offering credit repair services on the side, raking in hundreds of dollars for very little work. Usually, their marketing literature will lead one to believe that they have specialized skills, training or knowledge to perform credit repair. This is not true. Of course, attorneys and CPAs would object to our characterization that they are operating a credit repair scam, but what they are doing is dishonest, since they know that their clients can easily dispute negative information on their credit reports themselves without having to pay anyone. In any event, be aware that if you pay an attorney or CPA to do your credit repair work, he or she will spend about five minutes filling out some paperwork (or an assistant will actually fill out the paperwork) and you will be billed hundreds of dollars for work you could easily and quickly do yourself.
Credit Repair Scams
Credit
