The Myth of Fast Credit Repair

If your credit score isn't enough to help you achieve your goals, you probably wish that you can fix the situation over night. Unfortunately, that is what many companies out there are hoping for! Thanks to the economic downturn, many new companies have sprung up with the mission to "help" those going through hard times. Most of these companies sell the fact that they offer either an easy way out or fast solution to your problems.

The reality is that the real mission of most of these companies is to make as much as they can from your misfortunes. As an example, the entire debt settlement industry has been called a sham by one state Attorney General. Many experts agree that these companies prey on those in vulnerable situations. They make promises that they can settle your debt for just pennies on the dollar and put an end to your financial troubles. They promise that they can save you from being sued and put an end to your phone ringing off the hook at all hours of the day.

In reality, the only thing that most people get from these companies is a worse credit rating! Clients are charged fees up front that are generally equal to at least 20% of their credit card debt. Once the settlement firms have their money, they then fail to deliver results and the clients are left to fend for themselves.

Another common scam is "credit repair" companies who claim that they can get major derogatory items, like a bankruptcy, removed from your credit file regardless of the age. The reality is that no one can guarantee that they can do this - at least not through legal means. But, clients who are looking to take shortcuts and affect fast credit repair very often fall prey. Some even believe that the methods used will be completely legal.

Most of these companies charge large upfront fees to complete what is called file segregation. This is essentially where you use an illegally obtained EIN number to create a new credit file. It is 100% illegal, and if you are caught you could even face jail time. Chances are, the company that instructed you to use these methods will suffer no consequences.

The bottom line is that credit and debt are not going to go away over night. How long it is going to take to rectify your situation is largely dependent on what your specific situation is. The best advice is to stay away from short cuts. If you put the work in you will get results!
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