Understanding Credit Card Relief Scams

Published on Oct 14, 2013 09:42 am

How Do Credit Card Relief Scams Work?If you have a credit card, you may have already been called by credit card relief scammers. Some will offer to negotiate on your behalf and lower your interest rate for you. Others might offer to help you raise your credit score by changing items on your credit report — and some may even say that they can consolidate your debts and lower your payments. They all have one thing in common: they want to take your money.

Interest Rate ScamsInvariably, your phone rings right when you’re sitting down with your friends to play a video game or hang out. After answer, a person comes on the line promising to lower your credit card interest rates as long as you pay her hundreds or thousands of dollars. It’s likely a scam. These companies don’t have any special power over your rates — they take your money, call your credit card company and ask for a discount (if they even go that far) and then move on, whether or not they succeed.

Credit Report Modification ScamsIf you’ve found out that you have unfavorable items on your credit report, you might be tempted to respond to one of the many companies that offer to help you with your credit problem. Many of them take your money and don’t do much for you. The law is clear — accurate negative information stays on your credit report for seven or more years. While these services may send letters on your behalf or advise you on how to get more credit, they aren’t doing anything that you can’t do yourself.

Counseling and Consolidation ScamsSome special credit agencies offer to help you get out of credit trouble. They may promise to work with your creditors for you, get them to lower your interest rate and to take less money, and all you have to do is to pay them an up-front fee and make your monthly payments to them. There are some legitimate not-for-profit organizations in this industry, but they’ll offer you real education and counseling and won’t charge you an up-front fee other than a few dollars for administrative costs. The illegitimate companies take a much larger up-front fee and charge a high service fee every month.

Helping YourselfWhether you have imperfect credit or you just want to lower your interest rate, you can help yourself. One way to get started is to get your three bureau credit reports so that you can see if there are any errors or inaccuracies. If you’d like a lower interest rate, you can call your credit card company and ask for one. If you’re a good customer and have a strong payment history, you might get it. Call the company if you’re falling behind and need some help, as well. Many of them will work with you to help you get back on track and to keep you as a profitable customer.

About the AuthorCam Merritt has been a professional writer and editor since 1992, specializing in articles about personal finance and law. Merritt has a Bachelor of Arts in journalism from Drake University.

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.

Published by permission from ConsumerInfo.com, Inc.  © 2013 ConsumerInfo.com, Inc.  All rights reserved.

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