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Watch Out for These Credit Repair Scams

Managing your credit score can be a frustrating and time consuming process, especially if you don’t have good credit. If you’re planning on making a large purchase that requires a credit check, it can be draining to figure out how to boost your credit score quickly.

One resource some people turn to are credit repair companies. Even though there are some legitimate companies that are able to help remove bad credit information from a person’s credit report, there are also companies who are trying to scam consumers. Here are some scams to be aware of and tips on how you can start improving your credit score all on your own!

Credit Privacy Numbers

One scam that has recently made headlines is the use of Credit Privacy Numbers (CPNs). CPNs are nine digit numbers sold online and promoted as a way to instantly boost one’s credit score. Sellers will give consumers a CPN to use in place of their Social Security Number, as a way to protect their information and increase their buying power.

What some consumers don’t know is that CPNs are actually social security numbers. Sellers and websites will often obtain these SSNs fraudulently, and sell them to unsuspecting consumers. For those who are desperate to repair their credit, this could appear to be a dream come true, however, using a CPN can lead to more problems than bad credit.  

Erasing Credit History

Most credit repair companies want to help you remove inaccurate information from your credit report. However, there are companies that are encouraging and helping consumers remove legitimate information from their credit history. These companies will help people remove this valid credit information and encourage them to claim to be victims of identity theft. This is in an effort to increase  their credit score, without incurring penalties.

Companies claiming to help consumers do this are scammers and trying to make money quickly, all  while leaving them in deep water. All liability and responsibility for falsely reported identity theft will fall on you, the consumer, and not the company.  

Improving Your Credit

It can be difficult to figure out how to boost your credit. Here are some helpful tips to consider if you are trying to boost your credit score without using a credit repair company.

Make consistent payments

According to MyFICO.com, thirty-five percent of your credit score is based on whether you consistently make payments on your debts. A sure-fire ways to boost your credit is to budget a monthly amount to put towards your debts, and do it every month. While this is not going to instantly increase your score, you will see an increase over time.

Remove fraudulent information

Removing fraudulent or incorrect information is absolutely legal and free; you do not need to hire a company to check your credit report. You can pull a free credit report once a year with any of the three national credit bureaus (Equifax, Experian and TransUnion) and check to see if any accounts have been opened in your name that you did not authorize. If you find any errors or mistakes on your report, you can dispute them with the credit agencies.

Manage credit utilization

Credit utilization refers to the amount of credit you have used compared with how much credit you have available to use. If you’re someone who spends the maximum amount you’re able to on your credit card, you could be hurting your credit score. Your credit utilization makes up 30 percent of your credit score, so keeping an eye on how much you spend is important.

Here at Blackhawk Bank, we want all our customers to be informed, so that they can make the best decisions. To learn more about how Blackhawk Bank can help you, contact us today!

 

 

Author: 

Mat Reynolds
VP Retail Banking