Credit Repair Services

You shouldn't confuse seeking a credit-counseling service -- one that belongs to a reputable membership organization and is independently accredited -- with using a credit-repair service.

Credit-repair firms often aim to improve your credit history by taking shortcuts or finding other time-saving measures. Unscrupulous credit-repair services promise to end your credit woes with claims of "Easy credit!" and "End all your money worries!" Others may claim to be able to remove an adverse public record such as a judgment, lien or personal-bankruptcy filing from your credit report.

Such claims are false and misleading. In addition, any attempts by a credit-repair service to improve your credit history by modifying your identity could land you in trouble. According to the U.S. Federal Trade Commission (FTC), you could be charged with wire or mail fraud if you use falsified personal credit data to apply for credit.

If you use a credit-repair service, take advantage of the protections offered by the Credit Repair Organizations Act. One of these protections is to require the credit-repair service to deliver its promised service before you pay for those services.

The foundation of any good credit-repair program is a debt-repayment plan. By making payments on time, you're more likely to repair your credit history than by taking any magical elixir that a credit-repair service claims to offer.

For more information on the Credit Repair Organizations Act and on how to protect yourself from unscrupulous credit-repair services, see the FTC brochure, "Credit Repair: How to Help Yourself."