Credit Repair Scams Warning Signs

If you decide to respond to a credit repair offer, beware of companies that:

• want you to pay for credit repair services before any services are provided;
• do not tell you your legal rights and what you can do-yourself-for free;
• recommend that you not contact a credit bureau directly;
• suggest that you try to invent a "new" credit report by applying for an Employer Identification Number to use instead of your Social Security number; or
• advise you to dispute all information in your credit report or take any action that seems illegal, such as creating a new credit identity. If you follow illegal advice and commit fraud, you may be subject to prosecution.

You could be charged and prosecuted for mail or wire fraud if you use the mail or telephone to apply for credit and provide false information. It's a federal crime to make false statements on a loan or credit application, to misrepresent your Social Security number, and to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses.