The Federal Trade Commission (FTC) recently issued a report on credit repair companies. It is important to understand that a recent federal law called the "Credit Repair Organizations Act" mandates that credit companies cannot make you pay for services until they keep their promises and do what they are supposed to do. Many of these companies require upfront money for the fees but never do anything. When the consumer tries to get a refund, they find that the company is nothing more than a post office box. The FTC wants you to be sure that you do not pay until services are delivered and that the company tells you all of your rights.
You should be cautious if the company tells you not to contact any of the national credit reporting companies directly. Another warning flag is if they tell you they can get rid of negative credit on your report even if it is accurate. The final red flag is if the credit repair company tells you to create a new identity. That suggestion entails criminal wrongdoing.
At Checkett & Pauly, we have unfortunately met with many people who have been victims of credit repair scams. Please know that these companies are not regulated, nor are they bonded or licensed. If you are having credit problems you should speak with a qualified and experienced attorney.