Your credit score is a number with increasing importance in many aspects of our lives. Where it once was basically a determinant of how likely it was you could get a loan and how much you'd pay for it, now it's being used to screen job applications. There are any number of companies out there that offer to help you fix your credit score for a fee and a some of these companies are outright scams. So before you pay someone for their help here are a few things you should know:

Upfront Fees:

Does the firm you are considering ask you to pay in advance for any of their service? If so they are breaking the law and are almost certainly a scam. The Credit Repair Organizations Act lists upfront fees among practices prohibited in this statute (section 404).

Payment in Advance.--No credit repair organization may charge or receive any money or other valuable consideration for the performance of any service which the credit repair organization has agreed to perform for any consumer before such service is fully performed.
Accessing your Credit Report:

There are any number of services you can pay to get access to your credit reports for the three major reporting agencies but you are entitled by law to a copy of the reports once a year free of charge. The details are available on the FTC website linked here, also on that page ware warnings about websites that might use names and phrases like "free credit report" in their advertising but who hide their fees in small print. There are a few other circumstances under which you can obtain copies of your credit report without paying a fee. From the FTC link above:

Q: Are there any other situations where I might be eligible for a free report?

A: Under federal law, you’re entitled to a free report if a company takes adverse action against you, such as denying your application for credit, insurance, or employment, and you ask for your report within 60 days of receiving notice of the action. The notice will give you the name, address, and phone number of the consumer reporting company. You’re also entitled to one free report a year if you’re unemployed and plan to look for a job within 60 days; if you’re on welfare; or if your report is inaccurate because of fraud, including identity theft. Otherwise, a consumer reporting company may charge you up to $10.50 for another copy of your report within a
12-month period.
Disputing Information in Your Report:

If there is any inaccurate information in your credit report, you do not need to pay anyone to dispute it with the reporting agency you can do that yourself. This page on the FTC website describes the process. Please be aware that the only thing that can remove ACCURATE information that is damaging your credit score is time, seven years being typical. ANY credit repair service that claims otherwise IS a scam.

Some credit repair scams will try to use a new Employer Identification Number (EIN) or some other similar trick to start a fresh credit profile for you, without any of your past problems. This is illegal and can get you in far more trouble than your old credit score gave you. And if you're being pitches solutions like this you can be sure the service you're dealing with is fraudulent.

With tough economic times many people let their frustrations color their judgment and might look for hope from sources they'd otherwise never be desperate enough consider. There are completely discredited theories abounding which hold that the IRS is illegitimate so none of us owe federal taxes or that all bankers are evil so we don't need to pay our debts. People selling these ideas sometimes use terms like "UCC Redemption" or "Accepted for Value" in trying to describe why you don't really owe anyone anything. For a price they will tell you the "secret knoledge" they claim to possess which will make all your bills disappear but the truth is only thing that will vanish is the money you paid them.


Never pay up front for credit repair services, that is the first and most important way to avoid these scams. By law any credit repair service to provide you with a disclosure statement informing you of your rights as spelled out in the Credit Repair Organizations Act as linked above. These include:

  • Details about your rights to obtain your credit report.
  • Details of your rights to dispute the information in your report.
  • If the credit bureau's reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the credit bureau, to be kept in your file, explaining why you think the record is inaccurate. The credit bureau must include a summary of your statement about disputed information with any report it issues about you.
  • That you have a right to sue a credit repair service that violates the Credit Repair Organization Act
  • You have the right to cancel your contract with any credit repair service for any reason within 3 business days from the date you signed it.
  • There are more rights enumerated than are listed here.


They also must present you with a written contract for you to sign before you have any obligation to them. This contract must include:

  • The terms and conditions of payment, including the total amount of all payments to be made by the consumer to the credit repair service.
  • A full and detailed description of the services to be performed by the credit repair service for the consumer, including any guarantees of performance and an estimate of how long it will take to perform their services.
  • The credit repair service's name and principal business address.
  • Your rights to cancel without obligation in the first three days.


If the company you hire to fix your credit failed to provide with this information or it is in violation of any other portion of the Consumer Credit Protection Act, the act also describes the legal and civil remedies available to you.