Credit Repair: How To Help Yourself 

You see the advertisements in newspapers, on TV, and on the Internet. You hear them on the 

radio. You get fliers in the mail, and maybe even 

calls offering credit repair services. They all make the 

same claims:

“Credit problems? No problem!”

“We can remove bankruptcies, judgments, liens, and 

bad loans from your credit file forever!”

“We can erase your bad credit — 

100% guaranteed.”

“Create a new credit identity — 

legally.”

The Federal Trade 

Commission (FTC) says do 

yourself a favor and save some 

money, too. Don’t believe these 

claims: they’re very likely signs of 

a scam. Indeed, attorneys at the nation’s consumer 

protection agency say they’ve never seen a legitimate 

credit repair operation making those claims. The fact 

is there’s no quick fix for creditworthiness. You can 

improve your credit report legitimately, but it takes 

time, a conscious effort, and sticking to a personal 

debt repayment plan. 

Recognizing a Credit 

Repair Scam

Everyday, companies target consumers who have 

poor credit histories with promises to clean up 

their credit report so they can get a car loan, a 

home mortgage, insurance, or even a job once they 

pay them a fee for the service. The truth is, these 

companies can’t deliver an improved credit report for 

you using the tactics they promote. It’s illegal: No 

one can remove accurate negative information from 

your credit report. So after you pay 

them hundreds or thousands of 

dollars in fees, you’re left with the 

same credit report and someone 

else has your money. 

If you see a credit repair offer, 

here’s how to tell if the company 

behind it is up to no good:

n The company wants you to pay for credit repair 

services before they provide any services. Under 

the Credit Repair Organizations Act, credit 

repair companies cannot require you to pay 

until they have completed the services they have 

promised.

n The company doesn’t tell you your rights and 

what you can do for yourself for free.

October 2008

No one can remove 

accurate negative 

information from 

your credit report.
n The company recommends that you do not 

contact any of the three major national credit 

reporting companies directly.

n The company tells you they can get rid of most 

or all the negative credit information in your 

credit report, even if that information is accurate 

and current. 

n The company suggests that you try to invent a 

“new” credit identity — and then, a new credit 

report — by applying for 

an Employer Identification 

Number to use instead 

of your Social Security 

number.

n The company advises 

you to dispute all the 

information in your credit 

report, regardless of its 

accuracy or timeliness. 

If you follow illegal advice and commit fraud, 

you may find yourself in legal hot water, too: It’s a 

federal crime to lie on a loan or credit application, 

to misrepresent your Social Security number, and to 

obtain an Employer Identification Number from the 

Internal Revenue Service under false pretenses. You 

could be charged and prosecuted for mail or wire 

fraud if you use the mail, telephone, or Internet to 

apply for credit and provide false information. 

Your Rights Regarding 

Credit Repair 

No one can legally remove accurate and timely 

negative information from a credit report. The law 

allows you to ask for an investigation of information 

in your file that you dispute as inaccurate or 

incomplete. There is no charge for this. Some people 

hire a company to investigate on their behalf, but 

anything a credit repair clinic can do legally, you can 

do for yourself at little or no cost. According to the 

Fair Credit Reporting Act (FCRA):

n You’re entitled to a free report if a company 

takes “adverse action” against you, like denying 

your application for credit, insurance, or 

employment. You have to ask for your report 

within 60 days of receiving notice of the action. 

The notice will give you the 

name, address, and phone 

number of the consumer 

reporting company. You’re also 

entitled to one free report a 

year if you’re unemployed and 

plan to look for a job within 

60 days; if you’re on welfare; 

or if your report is inaccurate 

because of fraud, including identity theft.

n Each of the nationwide consumer reporting 

companies — Equifax, Experian, and 

TransUnion — is required to provide you with 

a free copy of your credit report once every 12 

months, if you ask for it. The three companies 

have a central website, a toll-free telephone 

number, and a mailing address for consumers 

to order the free annual credit reports the 

government entitles them to. To order, click on 

annualcreditreport.com, call 1-877-322-8228, 

or complete the Annual Credit Report Request 

Form and mail it to: 

Annual Credit Report Request Service 

P.O. Box 105281

Atlanta, GA 30348-5281

Anything a credit repair 

clinic can do legally, you 

can do for yourself at 

little or no cost.

2 FTC Facts For Consumers
 You can use the form in this 

brochure, or you can print it 

from ftc.gov/credit. You may 

order reports from each of 

the three consumer reporting 

companies at the same time, 

or you can stagger your 

requests, ordering one from 

each company throughout 

the year from the central 

address. Don’t contact the 

three nationwide consumer 

reporting companies 

individually or at another 

address because you may 

end up paying for a report 

that you’re entitled to get for 

free. In fact, each consumer 

reporting company may 

charge you up to $10.50 to 

purchase an additional copy of 

your report within a 

12-month period. 

n It doesn’t cost anything 

to dispute mistakes or 

outdated items on your 

credit report. Under the 

FCRA, both the consumer reporting company 

and the information provider (that is, the 

person, company, or organization that provides 

information about you to a consumer reporting 

company) are responsible for correcting 

inaccurate or incomplete information in your 

report. To take advantage of all your rights under 

the FCRA, contact the consumer reporting 

company and the information provider.

Helping Yourself

Step 1: Tell the consumer reporting company, in 

writing, what information you think is inaccurate. 

Include copies (NOT originals) of any documents 

that support your position. In addition to providing 

your complete name and address, your letter should 

identify each item in your report you dispute; 

state the facts and the reasons you dispute the 

information, and ask that it be removed or corrected. 

You may want to enclose a copy of your report, and 

Sample Dispute Letter

Date

Your Name 

Your Address,

City, State, Zip Code 

Complaint Department

Name of Company

Address

City, State, Zip Code

Dear Sir or Madam: 

I am writing to dispute the following information in my file. 

The items I dispute also are encircled on the attached copy of the 

report I received. 

This item (identify item(s) disputed by name of source, such 

as creditors or tax court, and identify type of item, such as credit 

account, judgment, etc.) is (inaccurate or incomplete) because 

(describe what is inaccurate or incomplete and why). I am 

requesting that the item be deleted (or request another specific 

change) to correct the information.

Enclosed are copies of (use this sentence if applicable and 

describe any enclosed documentation, such as payment records, 

court documents) supporting my position. Please investigate this 

(these) matter(s) and (delete or correct) the disputed item(s) as 

soon as possible.

Sincerely, 

Your name 

Enclosures: (List what you are enclosing.)

FTC Facts For Consumers 3
circle the items in question. Send your letter by 

certified mail, “return receipt requested,” so you can 

document that the consumer reporting company 

received it. Keep copies of your dispute letter and 

enclosures.

Your letter may look something like the one on 

the previous page.

Consumer reporting companies must investigate 

the items you question 

within 30 days — unless 

they consider your 

dispute frivolous. They 

also must forward all the 

relevant data you provide 

about the inaccuracy 

to the organization 

that provided the 

information. After the 

information provider 

receives notice of 

a dispute from the 

consumer reporting company, it is required to 

investigate, review the relevant information, and 

report the results back to the consumer reporting 

company. If this investigation reveals that the 

disputed information is inaccurate, the information 

provider has to notify the nationwide consumer 

reporting companies so they can correct it in 

your file.

When the investigation is complete, the 

consumer reporting company must give you the 

results in writing, too, and a free copy of your 

report if the dispute results in a change. If an item 

is changed or deleted, the consumer reporting 

company is not permitted to put the disputed 

information back in your file unless the information 

provider verifies that it is accurate and complete. 

The consumer reporting company also must send 

you written notice that includes the name, address, 

and phone number of the information provider. 

If you ask, the consumer reporting company must 

send notices of any correction to anyone who 

received your report in the past six months. You 

also can ask that a corrected copy 

of your report be sent to anyone 

who received a copy during the 

past two years for employment 

purposes. 

If an investigation doesn’t 

resolve your dispute with the 

consumer reporting company, 

you can ask that a statement of 

the dispute be included in your 

file and in future reports. You also 

can ask the consumer reporting 

company to provide your statement to anyone who 

received a copy of your report in the recent past. You 

can expect to pay for this service.

Step 2: Tell the creditor or other information 

provider, in writing, that you dispute an item. Be 

sure to include copies (NOT originals) of documents 

that support your position. Many providers specify 

an address for disputes. If the provider reports the 

item to a consumer reporting company, it must 

include a notice of your dispute. And if you are 

correct — that is, if the information is found to be 

inaccurate — the information provider may not 

report it again.

A consumer reporting 

company can report 

most accurate negative 

information for seven 

years and bankruptcy 

information for 10 years.

4 FTC Facts For Consumers
Reporting Accurate 

Negative Information

When negative information in your report is 

accurate, only the passage of time can assure its 

removal. A consumer reporting company can 

report most accurate negative information for seven 

years and bankruptcy information for 10 years. 

Information about an unpaid judgment against 

you can be reported for seven years or until the 

statute of limitations runs out, whichever is longer. 

To calculate the seven-year reporting period, start 

from the date the event took place. There is no 

time limit on reporting information about criminal 

convictions; information reported in response to 

your application for a job that pays more than 

$75,000 a year; and information reported because 

you’ve applied for more than $150,000 worth of 

credit or life insurance.

The Credit Repair 

Organizations Act 

Credit repair organizations 

must give you a copy of the 

“Consumer Credit File Rights 

Under State and Federal Law” 

before you sign a contract. They 

also must give you a written 

contract that spells out your 

rights and obligations. Read 

these documents before you sign 

anything. And before signing, know that a credit 

repair company cannot: 

n make false claims about their services

n charge you until they have completed the 

promised services

n perform any services until they have your 

signature on a written contract and have 

completed a three-day waiting period. During 

this time, you can cancel the contract without 

paying any fees.

Before you sign a contract, be sure it specifies: 

n the payment terms for services, including the 

total cost

n a detailed description of the services the 

company will perform 

n how long it will take to achieve the results

n any guarantees the company offers

n the company’s name and business address

Have You Been Victimized? 

Many states have laws regulating credit repair 

companies. State law enforcement officials may be 

helpful if you’ve lost money to credit repair scams. 

Don’t be embarrassed to report 

a problem with a credit repair 

company. While you may fear 

that contacting the government 

could make your problems 

worse, remember that laws are 

in place to protect you. Contact 

your local consumer affairs 

office or your state Attorney 

General (AGs). Many AGs have 

toll-free consumer hotlines; check the Blue Pages of 

your telephone directory for the phone number or 

www.naag.org for a list of state attorneys general.

Just because you have 

a poor credit report 

doesn’t mean you won’t 

be able to get credit.

FTC Facts For Consumers 5
If You Need Help 

Just because you have a poor credit report doesn’t 

mean you can’t get credit. Creditors set their own 

standards, and not all look at your credit history the 

same way. Some may look only at recent years to 

evaluate you for credit, and they may give you credit 

if your bill-paying history has improved. It may be 

worthwhile to contact creditors informally to discuss 

their credit standards.

If you’re not disciplined enough to create a 

workable budget and stick to it, to work out a 

repayment plan with your creditors, or to keep 

track of your mounting bills, you might consider 

contacting a credit counseling organization. Many 

credit counseling organizations are nonprofit and 

work with you to solve your financial problems. But 

remember that “nonprofit” status doesn’t guarantee 

free, affordable, or even legitimate services. In fact, 

some credit counseling organizations — even some 

that claim non-profit status — may charge high fees 

or hide their fees by pressuring consumers to make 

“voluntary” contributions that only cause more debt.

Most credit counselors offer services through 

local offices, the Internet, or on the telephone. If 

possible, find an organization that offers in-person 

counseling. Many universities, military bases, 

credit unions, housing authorities, and branches 

of the U.S. Cooperative Extension Service operate 

nonprofit credit counseling programs. Your financial 

institution, local consumer protection agency, and 

friends and family also may be good sources of 

information and referrals.

If you are considering filing for bankruptcy, be 

aware that bankruptcy laws require that you get 

credit counseling from a government-approved 

organization within six months before you file 

for bankruptcy relief. You can find a state-bystate list of government-approved organizations at 

www.usdoj.gov/ust, the website of the U.S. Trustee 

Program. That’s the organization within the U.S. 

Department of Justice that supervises bankruptcy 

cases and trustees. Be wary of credit counseling 

organizations that say they are governmentapproved, but do not appear on the list of approved 

organizations.

Reputable credit counseling organizations can 

advise you on managing your money and debts, help 

you develop a budget, and offer free educational 

materials and workshops. Their counselors are 

certified and trained in the areas of consumer credit, 

money and debt management, and budgeting. 

Counselors discuss your entire financial situation 

with you, and can help you develop a personalized 

plan to solve your money problems. An initial 

counseling session typically lasts an hour, with an 

offer of follow-up sessions. 

Do-It-Yourself Check-Up 

Regardless of your credit history, financial advisors 

and consumer advocates recommend reviewing your 

credit report periodically for three important reasons:

1. The information in your credit report affects 

whether you can get a loan or insurance — 

and how much you will have to pay for it. 

2. It’s important to make sure the information is 

accurate, complete, and up-to-date before you 

apply for a loan for a major purchase like a 

house or car, buy insurance, or apply for a job. 

3. It can help you deter, detect and defend 

against identity theft. That’s when someone 

uses your personal information — like your 

6 FTC Facts For Consumers
n Building a Better Credit Report — Learn how 

to legally improve your credit report, how to 

deal with debt, how to spot credit-related scams, 

and more.

n Knee Deep in Debt — Discusses options to help 

you get back in the black, including: realistic 

budgeting, credit counseling from a reputable 

organization, debt consolidation, or bankruptcy. 

n Fiscal Fitness: Choosing a Credit Counselor — 

Defines debt repayment plans, explains the 

differences between secured and unsecured debt, 

and offers questions to ask credit counseling 

agencies if you consider using their services.

The FTC works for the consumer to prevent 

fraudulent, deceptive, and unfair business 

practices in the marketplace and to provide 

information to help consumers spot, stop, and 

avoid them. To file a complaint or to get free 

information on consumer issues, visit ftc.gov or 

call toll-free, 1-877-FTC-HELP (1-877-382-4357); 

TTY: 1-866-653-4261. The FTC enters consumer 

complaints into the Consumer Sentinel Network, 

a secure online database and investigative tool used 

by hundreds of civil and criminal law enforcement 

agencies in the U.S. and abroad.

FTC Facts For Consumers 7

name, your Social Security number, or your 

credit card number — to commit fraud. 

Identity thieves may use your information 

to open a new credit card account in your 

name. Then, when they don’t pay the bills, the 

delinquent account is reported on your credit 

report. Inaccurate information like that could 

affect your ability to get credit, insurance, or 

even a job. 

For More Information

To learn how to improve your credit worthiness 

and find legitimate resources for low or no-cost 

help, please see the following publications at 

ftc.gov/credit.

n Your Access to Free Credit Reports — Explains 

why it is important to monitor your credit 

history, how to request a report, and how to 

dispute errors. 

n How to Dispute Credit Report Errors — 

Explains how to dispute and correct inaccurate 

information in your credit report. Includes a 

sample dispute letter.

Federal Trade Commission

Bureau of Consumer Protection

Division of Consumer and Business Education
You have the right to get a free copy of your credit file disclosure, commonly called a credit report, once every 12 months, from each of

the nationwide consumer credit reporting companies - Equifax, Experian and TransUnion.

For instant access to your free credit report, visit www.annualcreditreport.com.

For more information on obtaining your free credit report, visit www.annualcreditreport.com or call 1-877-322-8228.

Use this form if you prefer to write to request your credit report from any, or all, of the nationwide consumer credit reporting companies. The

following information is required to process your request. Omission of any information may delay your request.

If additional information is needed to process your request, the consumer credit

reporting company will contact you by mail.

Your request will be processed within 15 days of receipt and then mailed to you.

Annual Credit Report Request Form

Once complete, fold (do not staple or tape), place into a #10 envelope, affix required postage and mail to:

Annual Credit Report Request Service P.O. Box 105281 Atlanta, GA 30348-5281.

Copyright 2004, Central Source LLC

Equifax

Experian

TransUnion

I want a credit report from (shade

each that you would like to

receive):

Shade here if, for security

reasons, you want your credit

report to include no more than

the last four digits of your

Social Security Number.

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Social Security Number:

- -

Date of Birth:

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Month Day Year

First Name M.I.

Last Name JR, SR, III, etc.

Current Mailing Address:

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City State ZipCode

City State ZipCode

Apartment Number / Private Mailbox For Puerto Rico Only: Print Urbanization Name

House Number Street Name

Previous Mailing Address (complete only if at current mailing address for less than two years):

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