I don’t know about you, but if I’m running a scammy business and get hit with a $7.4 million penalty from the federal government, I’m at least going to think twice about running the same scam again. And yet, a Florida couple completely disregarded court orders by continuing to sell people on their illegal credit-repair system. [More]
SmartMoney’s Anne Kadet looked into the process by which the three major credit bureaus—Experian, TransUnion, and Equifax—investigate and correct errors on credit reports. What she found was that the process is “almost entirely automated,” and that “many lenders respond by simply rereporting the erroneous data.” Here’s how it works, and your meager options when something goes wrong.
If you have bad credit and have been thinking about working with a credit repair firm, think again. Credit repair services aren’t doing anything that you can’t otherwise do for yourself. They review your credit history, lodge disputes, follow up, rinse and repeat. The appeal of a credit repair service is that they spend all that time resolving issues so that you don’t have to. They can’t take legitimately negative things off your record and they can’t work magic. Any firm that promises or guarantees to improve your score isn’t telling you the whole truth and you should watch out.
Ever wonder how credit repair services work? According to the FTC, they take your money, often illegally, and then perform services that are available to any and all consumers. The shops start by charging an initial registration fee from $20 to $100. This is against federal law, which prohibits payment until the repair has been performed. The shops then charge a fee to obtain your credit report, even though you can access one free copy of your report each year at AnnualCreditReport.com.