There are a number of credit repair companies, which are working to help financially troubled customers. Â But all of these companies are not reliable and if you are looking for a credit repair company then you have to be careful and select one for you wisely. Scammers can dodge you anytime. Here are a number of scams which you should be wary of; some of these scams are as follows.
What scam credit repair companies actually do?
Scam credit repair companies steal the contact details of a customer. They lie to their customers and tell them that they can start a new credit report and their old bad debts would not appear on the new one. When the customer decided to work with them,. These scammers do the following things.
- They use their original names because a lot of people have the same name.
- They get a new telephone number or a new cell phone service.
- They change their address by using any mail forwarding service or using friendâs address.
- They get a new scam number in order to replace your Social Security Number. These scammers give you an EIN (Employer Identification Number) which is assigned to small business to apply for a Federal Tax Identification Number. This number consists of nine digits similar to that of the Social Security Number. They will tell you that all your previous debts are cleared and now you can take a new start with new credit report.
People would be satisfied with the clean report, but they will asked to show their original Social Security Number as soon as they apply for any big purchase such as, a car or a mortgage etc. the lender will ask you about your Social Security Number pointing out that you donât possess any credit history. Therefore you are required to guarantee the debt personally, which you are about to take.
What would happen to you with EIN?
At this moment you will find yourself at the point where you started, or even worse than that. That is because the attempt from you to use your EIN for taking out loan can be reported to the court and they can bring you in court for attempting fraud with your EIN.
- Misrepresenting your Social Security Number is also a crime that comes under the federal laws.
- Obtaining an EIN from the IRS under the fake r wrong pretenses is also regarded as the federal crime.
- If you apply for the loan through mail or telephone, then you will be charged to attempt a mail or wire fraud for using the false information and applying for credit.
How to avoid scam credit repair companies?
The simplest way to keep you safe from credit repair companies is to carry out a proper research before deciding working with any. The best way is to go through the Credit Repair Organizations Act and get t know how you can use it. At the time of signing contract make sure you have gone through it carefully and aware of what they are offering you. Donât pay for their services until they do it for you.
