Beware of credit repair scammers
Credit bureaus offer a free dispute service
Many people are desperate to wish away their bad credit score so they can take up new credit to buy their dream house or get that car whose very thought of driving keeps them up at night.
However, the reality is that there are no overnight solutions to fixing your credit history. It is important to keep an eye out for “credit repair scams”.
These are unscrupulous entities that ask you to pay before providing services.
The company may tell you it can guarantee a specific increase in your credit score or get rid of negative credit information in your credit report, though the information is accurate and current.
Look out for these signs to determine if a credit repair company is trying to pull a scam:
• It promises to remove negative information from your credit report.
• Advises against contacting a credit bureau directly.
• It requests an upfront fee before any type of credit repair is performed.
• It asks you to sign blank forms and provide personal information so the company can act on your behalf to help with credit problems.
• Recommends you dispute your credit report information without having seen your credit information or verifying the validity of this data with your credit providers.
Annelene Dippenaar, a chief legal and compliance officer at Experian Africa, said scammers had come up with innovative ways to deceive people, and the company had seen an increase in some posing as “credit repair agents”.
“These scammers are often found on popular classifieds websites and social media, or even distributing flyers in your area or placing ads in local papers. In South Africa, charging consumers an upfront fee to fix credit reports is illegal.
“It’s documented in schedule 1 of the Consumer Protection Act and the National Credit Act.”
It is also important to note that all credit bureaus offer a free credit information dispute process. To dispute the information on your credit report, the first step is getting a copy of your report. Next, you should check what information is on your report. If there is any incorrect information, contact the bureaus directly to dispute it. When contacting a bureau, make sure you’re armed with the following documentation:
• A copy of your ID document or passport.
• Proof of address (not older than three months).
• Any supporting documentation of the dispute (account, statement, etc.)
The credit bureau will then investigate the dispute. This investigation process can take up to 20 business days.