The Truth

No one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete. There is no charge for this. Everything a credit repair clinic can do for you legally, you can do for yourself at little or no cost. According to the Fair Credit Reporting Act (FCRA):
 

Spotting credit-repair scams
Be leery if you are tempted to contact a credit-repair company. The Federal Trade Commission and several attorneys general have sued credit-repair companies for falsely promising to remove bad information from credit reports. Here are tips to follow:

 Avoid companies that tell you truthful information can be changed or erased to improve your credit or that only the credit-repair company can remove old or inaccurate information. These claims are false.

 Be wary if you are asked for a large sum of money before the credit-repair company completes the job. A money-back guarantee will not protect you from a disreputable company.

Avoid new credit identities
If you have filed for bankruptcy, you may be the target of a credit-repair scheme, often called “file segregation.” Here, you are promised a chance to hide unfavorable credit information by establishing a new credit identity.

However, there is a problem: File segregation is illegal. If you use it, you could face fines or imprisonment.

Other scams
Consumers looking for an easy fix often are targets of other credit-related scams:

 Credit by phone: Pay-per-call or 900-number services have become a popular vehicle for credit scams. Advertisements promise that “guaranteed” credit or cash loans are only a phone call away. Instead, the caller might only receive a list of banks offering low-interest credit cards or a booklet on how to establish credit — and a phone charge of $50 or more. Consumers rarely end up getting credit.

 Gold or platinum cards: Beware of promotions for gold or platinum cards that promise to get you credit and build your rating. Although they may sound like all-purpose credit cards, some cards only permit you to buy merchandise from special catalogs and will not help you obtain other credit. You also might be asked to call a 900 or 976 exchange number for more information. These phone charges add up quickly.

 Checking-account scam: This scam, which tricks you into disclosing your checking-account number, typically begins with a postcard advertising easy credit approval or low-interest credit card rates. When you call, you are asked for your checking-account number as “verification.” Your number then can be magnetically encoded on a draft, which is forwarded to your unsuspecting bank for payment from your account.

(Never give out your bank account or credit-card number unless you know the company is reputable.)

Taking control of credit
If you need help paying your bills, you have several options:

 Contact your creditor and try to work out an adjusted repayment plan.

 Check your telephone directory for nonprofit financial counseling programs. Some universities, county extension centers, military bases, credit unions, housing authorities and banks operate programs and charge little, if anything, for assistance.

 Contact Consumer Credit Counseling Service, a nonprofit agency. Debt counselors will try to arrange a repayment plan that is acceptable to you and your creditors and will set up a budget for you. Call 800-388-2227 for the nearest CCCS office.