{"id":206954,"date":"2023-09-12T10:00:29","date_gmt":"2023-09-12T17:00:29","guid":{"rendered":"https:\/\/www.nationalfunding.com\/blog\/?p=206954"},"modified":"2023-10-24T13:32:59","modified_gmt":"2023-10-24T20:32:59","slug":"how-to-avoid-debt-relief-and-credit-repair-scams","status":"publish","type":"post","link":"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/","title":{"rendered":"How to Avoid Debt Relief and Credit Repair Scams"},"content":{"rendered":"<p>Have you received a telephone call, email, or physical mail solicitation from a debt relief or credit repair agency? When you have a mound of debt that you feel you will never get out from under, that solicitation promising to settle your debt for pennies on the dollar can be very tempting. But have you also thought to yourself this may be too good to be true? Maybe you\u2019re thinking that because it is true.<\/p>\n<p>While there are some reputable companies that can help you, debt relief service and credit repair scams frequently target financially distressed consumers who are having credit problems by falsely claiming to get you out of debt quickly and cleanly or remove negative information from your credit reports even if that information is accurate.<\/p>\n<p>They ask you to pay them before they do anything for you. That is illegal and a big red flag. (Legitimate debt relief firms do charge for their services but can collect only when they get results.)<\/p>\n<h2>Warning Signs of Credit Repair Scams<\/h2>\n<p>Here are some warning signs that your debt relief or credit repair agency is not credible:<\/p>\n<ul>\n<li>The debt relief company asks for fees in advance before it settles any debts.<\/li>\n<li>The company guarantees it can eliminate your debt or reduce it by a particular amount in a set period.<\/li>\n<li>The company advises you to cut off communication with creditors.<\/li>\n<li>The company won\u2019t send you information about its services unless you provide financial information such as credit card account numbers and balances.<\/li>\n<\/ul>\n<p>These operations often charge cash-strapped consumers a large up-front fee, but then fail to help them settle or lower their debts or remove the negative credit information \u2013 if they provide any service at all. Many firms instruct clients to stop paying their debts, on the premise that this will compel creditors to negotiate a reduction. It might \u2014 but creditors are under no obligation to settle your debt, and instead they may file a lawsuit against you to enforce the debt. All the while, you could accrue interest and penalties and damage your credit score. Some firms don\u2019t fully explain the potential consequences, according to the Federal Trade Commission (FTC).<\/p>\n<h2>Watchdog Organizations for Debt Relief Scams<\/h2>\n<p>The FTC has brought scores of law enforcement actions against these bogus credit-related services, and the agency has partnered with the states to bring hundreds of additional lawsuits.<\/p>\n<p>The FTC has a <a href=\"https:\/\/www.chamberofcommerce.org\/small-business-statistics\/\">list of cases and articles about<\/a> enforcement actions brought against these scammers.<\/p>\n<p>Just recently, the FTC filed a <a href=\"https:\/\/www.ftc.gov\/news-events\/news\/press-releases\/2023\/05\/ftc-lawsuit-leads-permanent-ban-debt-relief-telemarketing-operators-debt-relief-scam\">lawsuit<\/a> against an alleged credit card debt relief scheme based in Tennessee. The defendant was charged with taking tens of millions of dollars from people by falsely promising to eliminate or substantially reduce their credit card debt.<\/p>\n<p>The FTC maintains a <a href=\"https:\/\/www.ftc.gov\/legal-library\/browse\/cases-proceedings\/banned-debt-mortgage-relief-providers\/list\">list of companies<\/a> or people banned from participating in all or specific types of debt relief businesses.<\/p>\n<p>It\u2019s not just the FTC. The Consumer Financial Protection Bureau (CFPB) has also cracked down on these types of scams. In May 2023, the CFPB distributed more than $22 million to consumers who were harmed by a debt relief agency that promised it would eliminate their credit card debts and improve their credit scores. The company advertised to potential customers, through direct mailers and third-party lead generators, that its so-called \u201cdebt validation\u201d program used a legally vetted process to eliminate debt. The CFPB\u2019s investigation found that the company failed to produce any evidence that it had invalidated, eliminated, or lowered any of its customers\u2019 debts. It also told its customers that it could restore their credit scores, but the CFPB\u2019s investigation found that these claims were false or unsubstantiated.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Have you received a telephone call, email, or physical mail solicitation from a debt relief or credit repair agency? When you have a mound of debt that you feel you will never get out from under, that solicitation promising to settle your debt for pennies on the dollar can be very tempting. But have you<a class=\"excerpt-read-more\" href=\"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/\" title=\"ReadHow to Avoid Debt Relief and Credit Repair Scams\">&#8230; Read more &raquo;<\/a><\/p>\n","protected":false},"author":41,"featured_media":204405,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[64,3343],"class_list":["post-206954","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-financial-health","tag-credit-score","tag-debt-relief"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How to Avoid Debt Relief and Credit Repair Scams<\/title>\n<meta name=\"description\" content=\"Learn how to spot and avoid debt relief fraud with these 5 warning signs. 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Read about how to report a credit repair scam to watchdog organizations.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.nationalfunding.com\/blog\/blog\/wp-json\/wp\/v2\/posts\/206954\" \/>\n<meta property=\"og:site_name\" content=\"The Bottom Line by National Funding\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/national.funding\/\" \/>\n<meta property=\"article:published_time\" content=\"2023-09-12T17:00:29+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-10-24T20:32:59+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/live-nationalfunding.pantheonsite.io\/wp-content\/uploads\/2021\/11\/focused-senior-husband-a.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1440\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Stelios Harris\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@NationalFunding\" \/>\n<meta name=\"twitter:site\" content=\"@NationalFunding\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Stelios Harris\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/\",\"url\":\"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/\",\"name\":\"How to Avoid Debt Relief and Credit Repair Scams\",\"isPartOf\":{\"@id\":\"https:\/\/www.nationalfunding.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.nationalfunding.com\/blog\/how-to-avoid-debt-relief-and-credit-repair-scams\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/blog.nationalfunding.com\/wp-content\/uploads\/2021\/11\/focused-senior-husband-a.jpg\",\"datePublished\":\"2023-09-12T17:00:29+00:00\",\"dateModified\":\"2023-10-24T20:32:59+00:00\",\"author\":{\"@id\":\"https:\/\/www.nationalfunding.com\/blog\/#\/schema\/person\/1b30e1b7651b6785c5adde1b5df351c3\"},\"description\":\"Learn how to spot and avoid debt relief fraud with these 5 warning signs. 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