Fixing bad credit feels like climbing a mountain—steep, exhausting, and full of shady “shortcut” offers that lead nowhere. You must have heard companies claim they can “erase” bad credit or boost your score overnight. But are they legitimate? The truth, no, they aren’t! Did you know that in 2021 alone, the Federal Trade Commission (FTC) received 3,151 reports of credit repair fraud?  In fact, credit repair scams are on the rise, preying on those desperate for financial relief. Hence, it’s vital to confer that legitimate credit restoration takes time, strategy, and the right professionals. 

In this guide, we’ll break down red flags to watch for, credit restoration scams to avoid, and how to choose a trustworthy credit restoration company that can actually help. Don’t let desperation lead you into a trap—let’s explore how to restore your credit the right way!

Fraud Alert! Credit Restoration Red Flags You Can’t Ignore

Here are some major red flags that scream credit restoration scam—and trust me, these shady companies are everywhere. Let’s break them down so you don’t fall for their tricks.

We Can Erase Your Bad Credit—Guaranteed!

The biggest credit restoration scam alert is when a company promises to delete negative but accurate information from your credit report. No one, not even the best lawyer in the world, can legally remove legit negative marks like legitimate bankruptcies, foreclosures, charge-offs, missed payments, bankruptcies, or defaults before they expire (which can take up to 7-10 years). 

A prime example of this scam was a Florida-based credit repair company, “Clean Credit USA,” that claimed to erase bad credit in 30 days. The Federal Trade Commission (FTC) sued them because they were just filing false identity theft claims to get items removed. It backfired, and many clients ended up in legal trouble.

Pay Us First—Results Later (Upfront Fees = Scam)

Legit credit repair companies don’t charge upfront fees. According to the Credit Repair Organizations Act (CROA), they can only charge AFTER they’ve done the promised work.

Scam Alert: If they demand hundreds (or thousands) of dollars upfront, they’re likely taking your money and running, it’s a red flag of Credit restoration.

Lexington Law, one of the biggest credit repair firms, was sued in 2019 for charging upfront fees before doing any work. They had to refund millions to customers.

We’ll Get You a New Credit Identity (That’s Illegal!)

Some scammers claim they can give you a “new” credit identity using a CPN (Credit Privacy Number) or an EIN (Employer Identification Number). This is 100% illegal—it’s fraud, and you could be charged with identity theft.

A company called “Crown Credit Pro” was caught selling fake Social Security numbers (SSNs) to customers. Their clients were using them to apply for loans, which is a federal crime. Many ended up facing jail time instead of getting their credit fixed.

Don’t Contact the Credit Bureaus Yourself

Legit credit repair companies never tell you to avoid contacting Experian, Equifax, or TransUnion yourself. If a company says:

“Let us handle everything, don’t talk to anyone.”

Major Red flag of Credit restoration! They may be filing fake disputes on your behalf or using illegal tactics to temporarily boost your score. Many credit restoration scam companies send generic dispute letters for every negative item on your report—even if it’s legit. The credit bureaus eventually catch on and reject ALL disputes, even the ones that are valid.

We Have Special Relationships with Credit Bureaus

No company has inside connections with the credit bureaus. Period. The only way to fix your credit is through:

• Legitimate disputes (for errors)
• Negotiating with creditors
• Good financial habits (paying bills on time, reducing debt)

A major scam unfolded when the FTC shut down Credit Game University because they falsely claimed to have “special agreements” with Equifax to delete negative items. Spoiler: They didn’t.

We’ll Boost Your Credit Score by Adding You as an Authorized User

This one is tricky. Some legit credit-building services allow people to become authorized users on good accounts to build credit. But scammers exploit this by selling access to fake or stolen credit accounts.

Scam Alert: If a company offers to sell you a credit history or add you to a random person’s credit line for a fee, it’s a scam—and could be credit fraud.

A Florida-based credit repair agency, The Credit Game, sold “tradelines” (authorized user spots on good accounts) for $3,000 each. Turns out, these accounts were either stolen identities or artificially created accounts. The FBI shut them down, and customers got flagged for fraud.

Guaranteed 800 Credit Score in 30 Days!

Credit repair takes time. Any company claiming they can get you a perfect credit score in a month is lying. Even if they temporarily boost your score using shady tactics, the changes won’t last. They do this by temporarily inflating your score by disputing everything on your report—even legitimate debts. But when those items get verified, your score plummets.

In fact, Experian, highlighted the use of fake credit profiles to give customers artificially high scores. Within months, their real credit reports resurfaced, and banks canceled their credit cards and loans. In return Experian launched Sure Profile™, to combat this. This tool helps detect synthetic identities, ensuring lenders make decisions based on genuine credit histories.

Sign Up for Our Exclusive ‘Credit Repair Loan’ to Fix Your Score

Some scammers try to trap you in high-interest loans disguised as “credit repair programs.” They claim taking the loan will improve your score, but in reality:

• The loan has outrageous fees & interest
• The company keeps most of the money
• You end up in deeper debt

Scam Alert:  Legitimate credit-building loans exist (like secured credit cards or credit-builder loans), but any “credit repair loan” that requires a huge deposit upfront is a credit restoration scam.

A fraudulent company in Chicago, Nationwide Credit Clearing, Inc., scammed people into taking $5,000 “credit repair loans” at 30% interest. Instead of fixing their credit, customers were forced into even more debt.

How to Choose a Credit Restoration Company That Actually Helps?

There are plenty of scams out there, but if you know what to look for, you can find a credit restoration company that genuinely improves your credit. Here’s how:

Paperwork or Pipe Dream? Check Their Credentials And Licence

Legit credit repair companies follow The Credit Repair Organizations Act (CROA)—it’s a federal law that protects you from shady practices. Look for companies registered with the Better Business Bureau (BBB) and other regulatory agencies.

Reputation Check: Don’t Get Played

Read reviews on BBB, Trustpilot, and Google—if they have a ton of complaints, it’s a red flag of Credit restoration. Next, check if they’ve been involved in lawsuits or government actions (Google: “[Company Name] lawsuit” or “[Company Name] scam”). Ask around—personal recommendations are gold.

No Smoke, No Mirrors: Demand Full Transparency

They should explain exactly what they’ll do for you before you pay a dime. You should get a written contract that clearly outlines services, pricing, and cancellation policies.

Process Matters: Don’t Fall for the Fast Fix

Verify their process before signing in. Learn that a good company will:

• Pull your credit reports (from all 3 bureaus—Experian, Equifax, and TransUnion).
• Dispute inaccuracies on your report (but won’t lie or falsify info).
• Offer education on improving credit habits, not just quick fixes.

If they’re only about disputing everything blindly, that’s not real credit repair—it’s a short-term trick that can backfire.

Don’t Get Finessed by Fees: Request Clear Cost Quotes

There are two legitimate pricing models for credit restoration:

•   Pay-per-deletion: You pay only when an item is successfully removed.
•   Monthly service fee: Ongoing service where they dispute items over time.

Avoid companies that demand a huge upfront fee—again, that’s illegal under CROA.

Conclusion

Fixing your credit the right way takes time, patience, and the right experts—don’t fall for scams that promise overnight results! The key is to work with a reputable company that follows the law and actually helps you improve your financial health. If you’re serious about boosting your credit and want to build business credit the smart way, Reliant Credit Repair has your back. Contact us today at (800) 707-7492 and start your journey toward financial freedom!