Entrepreneurial spirit is something that defines American attitude almost to anything. American kids are encouraged to be "business kids" from the very childhood, thus, entrepreneurial attitude is something rather familiar to them. There used to be the pharmaceutical industry that sincerely promised a so called "snake oil" that was to cure all the illnesses - anything from cold to cancer. It is no surprise that the whole thing failed. The advertising only gave false hopes. There is something very similar to that nowadays. I am talking about credit card repair companies that are claiming to be able to solve your most severe financial problems.
Certainly, there are some honest credit repair companies, but most of them are known to be swindlers. These ones will promise you to repair your spoiled credit record and improve your credit score up to an excellent one in a couple of days. They promise that you will be eligible for at least good credit cards. It all does sound very good as you feel you are being promised something extremely special. It sounds too good to be true but still lots of people tend to believe. Let's unveil couple of the myths that credit card repair companies have successfully introduced as the pure truth:
1. Customers with fair, good, excellent credit scores are being attacked by the companies promising all kinds of best overall cards. Those who have bad credit histories are being entreated by credit repair companies that swear to clear their credit scores up. The truth is that for most of these companies helping you is not a priority. Collecting hundreds and even thousands of dollars of fees is what that wish the most.
Most of these companies promise to repair one's bad credit history despite the regulations of the Fair Credit Reporting Act (FCRA). What these repair companies are actually trying to do - is to remove all the negative showings temporarily - no negative activity will be obvious, but only for some time. It all will look good for some weeks but it will not stay that way forever. One day the creditors finish the investigation and all the negative information is re-entered back in the database. By that moment credit repair companies are usually out of there with their money in the pocket. Don't expect your phone calls to be answered. The conclusion is pretty easy - never count on any credit card repair companies.
2. There is another trick that credit repair companies will try to do with those with bad/no credit histories. Known as "file segregation" it makes an illusion that cardholder can just easily walk away from his bad history. How does it work? A customer trying to get rid of his/her bad history will be advised to apply for Employer Identification Number (EIN) that has got the same number of digits as SSN. This new number they will use when applying for new credit cards. Since this number is not connected with any credit activity, it will show that consumer has got no history. Keep in mind, that most credit card companies are already aware of EINs. They are not complete fools, you know.
What happens next? Credit card company will contact the police and inform them that they suspect that someone is trying to mislead them. Mispresenting a SSN is a federal crime. Doesn't sound good, does it?
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