We are all being bombarded by these advertisements on a daily basis by these "credit repair" companies. They always seem to promise things such as: " We will take care of those liens no problem. We'll erase that charged off credit card from your credit report within the month". The claims sound too good to be true because for the most part that's exactly what they are!! We will cover the things you can do to rebuild or improve your fico score but let us first review how to spot these scam artists before they get a hold of your credit and hard earned money!

How to spot a credit repair scam:

Tipoff#1: The company demands payment before they start to work on your file. This is actually illegal- they can not demand payment until all their work is complete.

Tipoff#2: The company fails to disclose the free things a the consumer can do to better their current situation.

Tipoff#3 The company instructs you to never call any of the three major credit bureaus to discuss your report

Tipoff#4: The company says the can take care off the negatives on your report even if they are accurate.

Tipoff#5: The company urges you to apply for an employee id number to start a new credit identity.

If you follow through on unlawful advice you might be found guilty of fraud!

Your rights as a consumer

- If a potential lender denies you credit you are entitled to receive a copy of your credit report to see how they based their decison.

- Every year you are allowed to request and receive a free copy of your credit report.

- You have the right to dispute all claims in writing that you believe to be incorrect.

Tips to improve your credit

- Pay all credit lines off every month so that you are not carrying balances.

- Make all payments on time. Try to not even use the 15 day grace period that most creditors extend.

- Pull your credit once a year and dispute all erroneous claims against you.

- Never carry more than 50% of your available balance!!

- Make sure to have active lines of credit so you do have a credit history.

- Try to keep the department store credit cards to a minimum. Interest rates on these cards tend to be very high and not competitive with a typical credit card.

- If you have less than stellar credit, apply for a prepaid credit card. Most prepaid card companies report to all three bureaus so this will help you repair your score.

I hope you found this piece helpful! Remember, if it seems too good to be true it probably is!!