Business & Finance Credit

Credit Repair Schemes, Watch Out!

According to the Better Business Bureau, by the end of 2007, Americans owed more than $915 billion in credit card debt.
Debt is never a good thing for the credit report.
And groups that are up to no good, would, of course, capitalize on consumers who want to repair their damaged credit.
But the BBB says to beware of bogus credit repair services that would not only cost a lot of money but, in some cases, may also be illegal.
The complaints about credit repair companies have risen by 38% from 2004 to 2006 and the figures show that more than 400 of those complaints unresolved.
The consumers should know some facts about the negative effects of unpaid debts on their report--from the FICO score to how long debt relief programs or a bankruptcy stay on the report.
That way, they would know if the credit repair being offered them is legitimate.
A breakdown of the FICO Score: -35% Payment History (affected heavily by nonpayment) - 30% Amount Owed -15% Length of Credit History -10% New Credit -10% Types of Credit Used How long does debt settlement stay on the report? 7 years.
How long does bankruptcy stay on the report? For Chapter 13, 7 years.
For Chapter 7, 10 years.
**They cannot be removed legally from the report until the right time.
Consumers must not be taken in by miraculous credit repair promises heard on radio, seen on television, read on newspapers,received from the mail,and most especially, encountered in the web.
Many of the services, offered by credit repair companies, can be done d.
i.
y.
Consumers only have to do their homework and read up.
There are many free articles online to read from.
Here's some advice from the BBB when it comes to credit repair companies: • Do not tell you your legal rights and what you can do - legally - for free; • Recommend that you not contact a credit bureau directly; • Want you to pay for credit repair services before any services are provided; • Advise you to dispute all information in your credit report; • Take any action that seems illegal, such as creating a new credit identity by obtaining a federal employer identification number to use instead of a social security number; • Offer to let you "piggyback" on other consumer's good credit.
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