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Health & Fitness

The Truth About Companies that Promise to get you a Credit Card

A variety of schemes have popped-up that involve promises to "repair" your credit history, eliminate your debts and even get you a credit card, even if banks have turned you down. Don't believe it.

Connecticut BBB Warns Consumers About Scheme to Steal Your Money – Rather than Help you Obtain Credit

Connecticut Better Business Bureau has a warning for consumers about telemarketers who promise to help you obtain a credit card – even if you have a bad credit history.

A variety of schemes have popped-up that involve promises to “repair” your credit history, eliminate your debts and even get you a credit card, even if major issues have turned you down.  Not only do they not deliver on their promises, but they can also steal your identity and leave you further in debt.

Connecticut Better Business Bureau and the National Consumers League’s fraud.org website offer the following tips to identify credit card scams and protect yourself:

Beware of promises - Fraudulent credit card offers often target people who are having credit problems and haven’t been able to get cards elsewhere.  They may promise to get you a card, but legitimate credit card issuers generally don’t do business with people who have bad credit histories.

Never pay upfront - It’s against the law to for telemarketers to charge any fees in advance if they guarantee or claim they can help you get a credit card. If there is an application or processing fee, it should be very small, not the hundreds of dollars that con artists often request.  Any annual fee usually appears on your first credit card statement.

All that glitters is not gold - A “gold” or “silver” card may not be what you think.  Sometimes fraudulent credit card offers promise these cards from major card issuers.  What you receive–if you get anything at all–is a gold or silver-colored charge card that can only be used to buy overpriced goods from the issuer’s own catalog.

Try an alternative – Consumers with a poor credit history may still be eligible for a “secured” credit card.  These require you to place a deposit in an account at the issuing bank equal to your credit limit.  If you don’t pay your credit card bill, the bank will use your deposit to cover it.  This is also a good way to start rebuilding your credit.  

If you have credit problems, get counseling - Fraudulent credit card companies may also claim that they can repair your bad credit for a large upfront fee. But you can correct inaccurate information in your credit files yourself for free.  You can obtain a free, no strings attached copy of your credit reports from www.annualcreditreport.com, which is run by the three credit reporting agencies.  
 
If you do try to obtain a credit card, apply directly through your bank.  It is not necessary to pay a third party to help you, nor will it improve your eligibility.  Finally, another alternative that can offer the convenience of a credit card is a preloaded pay-as-you-go card.  These enable you to make purchases according to your available money, without the fear of overspending or running up a balance that you can’t pay off.

Your local Consumer Credit Counseling Service (CCCS) can provide advice about how to build a good credit record. The CCCS may also be able to make payment plans with your creditors if you’ve fallen behind.  These services are offered for free or at a very low cost.  

To find the nearest CCCS office, call toll-free, 888-388-2227, or go to www.nfcc.org.

-Submitted by Howard Schwartz, Executive Communications Director, Connecticut Better Business Bureau

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