How to Spot and Avoid Credit Repair Scams

Quick Answer

Some credit repair companies break the law—and suggest you do the same—to improve your credit score. If you’re worried about your credit, you can repair any inaccuracies on your own (for free), and take legitimate steps to improve your scores.

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Credit repair organizations might promise quick fixes that will remove negative marks from your credit history and increase your credit scores. But some credit repair companies are landing clients in hot water instead.

Over the years, the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC) have filed complaints and taken actions against credit repair companies for a variety of misleading and illegal practices. In some cases, the companies suggest clients break the law or use clients' information to illegally file fraudulent identity theft or police reports. While actively working on your credit can be important, you don't want to hire a company that leaves you worse off. Here's how to know if you're being scammed by a credit repair company and what you can do about it.

What Is Credit Repair?

Credit repair is when you pay a company to try to remove or change information that's on your credit report. For consumers, the goal is often to get rid of negative information in an attempt to increase credit scores. However, credit repair companies don't have a magical fix for your credit—despite the promises credit repair companies make.

If there is an error or inaccurate information on your credit report, a credit repair company might be able to get it changed or removed by disputing the information. But you can also dispute the information with your creditor or a credit bureau yourself for free. Experian makes this easy for you to do with the online Experian Dispute Center.

In an attempt to remove accurate, but negative, information from your credit reports, credit repair companies may in some cases file false police reports or identity theft reports with the FTC and then falsely claim that negative items on a consumer's credit report were the result of identity theft or credit fraud. They might also suggest customers lie to the credit bureaus or even file false police reports, which is illegal and might not even help your credit.

Credit bureaus cannot remove accurate negative items from your credit history before they reach the end of their timeline for removal. Late payments remain on a credit report for seven years, and closed accounts that were past due, such as written off accounts and collection accounts, are removed seven years after the date they were first reported as past due and never again brought current. Chapter 13 bankruptcy is also removed after seven years, while Chapter 7 bankruptcy can remain on your credit report for 10 years, and hard inquiries get removed after two years.

How to Spot a Credit Repair Scheme

The safest option is to avoid paying for credit repair altogether. Remember, there's nothing a credit repair company can do that you can't do on your own. The Fair Credit Reporting Act (FCRA) is a federal law that gives you the right to dispute inaccurate or incomplete information on your credit report for free.

The law requires credit bureaus to investigate all disputes except in certain cases (it already investigated the disputed information, for example). If a credit bureau verifies the disputed information with your creditor and the creditor determines the information to be accurate, the information in your credit report won't be removed.

If you still want to hire a credit repair organization, however, you can minimize your risk of a scam by avoiding companies that:

  • Guarantee your credit score will improve by a certain number of days or within a specific time period
  • Guarantee they can remove accurate negative items from your credit reports
  • Require you to pay an upfront fee
  • Have poor reviews online
  • Recommend you pay for or try to sell you an authorized-user account or tradeline

Unscrupulous credit repair companies might also suggest you can start fresh with a credit privacy/profile/protection number (CPN), which are often stolen Social Security numbers. Using the CPN to apply for credit could be illegal.

Before agreeing to anything or paying for services, you can also ask probing questions, such as whether you have the right to dispute inaccuracies on your own and how the company operates. If the business owner or representative lies or doesn't give you clear or truthful answers, that could be a sign something shady may be going on.

How to Repair Your Credit on Your Own

If your credit report has inaccurate information, you can repair it on your own by closely reviewing your credit reports and disputing inaccuracies. You can get your credit report for free from each credit bureau at

There may also be negative, but accurate, information on your credit report that's hurting your credit score. The credit bureaus will remove most negative marks after seven years, and its impact on your credit should lessen over time.

In the meantime, you can focus on:

And even though the impact of negative marks can diminish over time, it still might take months or years to get an excellent score.

Monitor Your Progress

You are your own best advocate when it comes to verifying your credit information and working to improve and repair your credit. Experian offers free credit report monitoring with free credit score tracking so you can check to see what's impacting your score the most and track your progress as you work to improve your score over time.