Dealing with a mound of debt and attempting to repair your credit score is tough enough, but falling victim to a debt management scam could really be infuriating as it could compound your financial woes. When in the process of obtaining credit card debt management services to repair credit standing, watch out for telltale signs of fraudulence.
Signs of Credit Card Debt Management Services Scam
The Credit Repair Organizations Act is a law that regulates credit repair companies. These companies are compelled by this law to carry out a number of obligations to their clients. Failure to meet these duties may be signs of a scam. Here are the red flags to watch out for:
- The credit card debt management services company does not furnish you with a reprint of the “Consumer Credit File Rights Under State and Federal Law”. This lists your rights including your entitlement to secure a credit report and contest erroneous credit report details.
- If the credit repair firm asks you to ink a contract without furnishing you a copy, that smells fishy.
- Even if you get a copy of the contract, but does not cover crucial details, this could be another cause for suspicion. The contract should mention the amount the credit card debt management services is charging you; the particulars of the services they must perform on your behalf; timeline for the services to be rendered; a declaration informing you that you can drop the contract within three days; and the name and business address of the company.
- Your mental alarm bells must also be ringing if you are asked for payment even prior to the execution of their services.
- Credit card debt management services have no clout in deleting any information that has been accounted in your credit report. Fraudsters may promise you this, see be on the lookout.
- Adopting a fictitious identity is illegal. If the credit repair firm promises to make or asks you to make a different identity using another social security number or federal employer identification number, you may be transacting with a scam artist.
- Lastly, if the debt management company asks you to sign a document stating that you are waiving your rights enumerated in the Credit Repair Organizations Act, this could really be a giveaway that its business is shady.