According to complaints filed with the St. Louis BBB, 85% say they received no services from the credit repair companies despite paying an average of $816 each and most received no refunds.
The BBB recommends the following to consumers looking to clean up their credit reports:
Follow the FTC advice. Do not hire credit repair companies. Only outdated or inaccurate information can be removed from a credit report.
Consider a trustworthy not-for-profit organization to resolve debt and credit problems.
Scrutinize a debt settlement contract and thoroughly check out a company you are considering doing business with the BBB, FTC or attorney general’s office.
BBB Study: Consumers Pay Scammers Thousands
For Credit Repair They Could Do Themselves For
Beleaguered consumers deep in debt are paying thousands of dollars to scammers to modify their credit report, a process known as credit repair, when they can do the same thing at little or no cost themselves, a St. Louis Better Business Bureaustudy reveals.
The study, released today, is titled “Are They Creditable? A Study of the Credit Repair and Debt Settlement Industries, Complaints, Laws & Enforcement.”
The study notes that credit repair involves an offer to erase negative information from a consumer’s credit report, while debt settlement is an effort to reduce a consumer’s debts or monthly payments through negotiations with the creditors.
The study makes the following recommendations:
- That consumers follow the FTC advice and not hire credit repair companies. Only outdated or inaccurate information can be removed from a credit report.
- That consumers consider a trustworthy not-for-profit organization to resolve their debt and credit problems.
- That consumers scrutinize a debt settlement contract and thoroughly check out a company with which he or she is considering doing business with the BBB, FTC or attorney general’s office.
- That federal and state authorities increase their efforts in rooting out the unscrupulous operators in both the credit repair and debt settlement industries.
- That consumer-oriented agencies increase their efforts to educate consumers of the pitfalls in seeking help with their debt or credit.
Learn Credit Repair Secrets The Banks Doesn’t Want Revealed: Credit Repair BBB