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CFPB warning on credit repair companys  Jan 30th, 2017 

Repairing your credit history after a setback can feel overwhelming. Unfortunately, that’s why some credit repair companies use confusing and misleading messaging to target anxious consumers who are just trying to get their financial lives back on track. 

Over the past several months, more than half of people who submitted complaints with the CFPB about credit repair chose the issue “fraud or scam” to describe their complaints.

Many people don’t know the full set of protections they have or understand the laws that govern credit repair companies. These companies must follow numerous federal laws, including the Credit Repair Organizations Act and often the Telemarketing Sales Rule, both of which forbid credit repair organizations from using deceptive practices and from accepting up-front fees.

If you see advertisements or receive offers to fix your credit, look out for these example red flags:

  • They demand payment upfront: The company wants you to pay before it provides any services. Under the Credit Repair Organizations Act, credit repair companies can’t request or receive payment until they’ve completed the services they’ve promised. Some companies will structure monthly payment plans to avoid this requirement, and you should know that no form of upfront payment is legal. A simple rule to follow is “Don’t pay upfront.” If the company uses telemarketing such that the Telemarketing Sales Rule applies, the company may not request or receive fees until it has provided you with a credit report generated more than six months after the promised results that shows the results.
  • It sounds too good to be true: The company tells you it can get rid of the negative credit information in your credit report in a short period, even if that information is accurate and current. Also, if they promise a specific increase in your credit score or guarantee a certain result. No one can guarantee this. It simply takes time to repair your credit file.
  • They can’t answer questions: The company representative can’t explain the specifics of the services they are offering you or the total cost for those services. Asking a few simple questions can help you determine if you are dealing with a reputable organization.
  • They hold back or provide misinformation: The company doesn’t inform you of your rights, including your right to obtain a written contract outlining the details of your arrangement, as well as having the ability to cancel your contract with the company within three business days. The company does not disclose the full cost of its services, and/or the company suggests that you should not (or cannot) contact any of the nationwide credit reporting companies directly (you can).
  • They ask you to misrepresent information: The company suggests that you try to invent a “new” credit identity – resulting in a new credit report – by applying for an Employer Identification Number instead of your Social Security number. 

Know your rights

Don’t pay a company upfront. According to the Telemarketing Sales Rule, it’s illegal for a telemarketing or sales company to charge you for credit repair services unless it has been six months since the company achieved the promised results and the company has proven to you that it achieved those results. You also have additional contract cancellation rights if you put money into a dedicated account at the request of the credit repair company – you can withdraw from these services at any time without penalty, including receiving all funds put into the account (minus permissible fees). The credit repair company is required to comply with your request within seven business days.

Under the Fair Credit Reporting Act, you have a legal right to dispute credit history errors yourself for free. You don’t have to pay a credit repair company to do it for you. The first step is to get your free annual credit report from one or more of the three nationwide credit-reporting companies to identify any errors. Check out our information on how to correct inaccuracies on your credit reports, including sample dispute letters and contact information for each of the three nationwide credit-reporting companies. You can also go online to any of the credit reporting companies’ websites and dispute errors.

If you think you might be the victim of a credit repair scam, or if you’ve had other issues with a credit repair company, you can submit a complaint to the CFPB. If you have more questions about credit reports and scores, check out Ask CFPB, our online database of frequently asked financial questions and answers.

http://www.consumerfinance.gov/about-us/blog/how-avoid-credit-repair-service-scams/?utm_source=facebook&utm_campaign=holidaysocial&utm_medium=social&utm_term=01032017


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  Jan 30th, 2017 
 
 
 
IRS Warns Tax Refunds Delayed   Jan 13th, 2017 

If your refund is delayed this year, you can thank the IRS — and identity thieves.

Millions of low-income Americans who rely on their annual tax refund to help pay their bills are going to have to wait a few weeks longer to get their check this year as the agency cracks down on fraudsters.

Tax refunds will be delayed this year for some 40 million Americans.

The delays impact 40 million working poor families claiming the earned income tax credit and the additional child tax credit.

For 2016, the maximum earned income tax credit is from $506 for no qualifying children to $6,269 for three or more qualifying children.

"For most of these people it's the biggest check they are going to get all year," IRS Commissioner John Koskinen told the Associated Press in an interview. "We are sensitive to that."

Under the 2015 PATH Act that goes into effect this year, the IRS must delay these refunds to have more time to screen the returns. Scammers and organized crime syndicates have been filing fraudulent returns and claiming tax payers refunds before they have a chance to file, according to the IRS.

The agency has been reminding taxpayers and prepares about the change in news releases since this summer.

Tax filing starts January 23. The IRS says most direct deposit e-filers usually receive their funds within 21 days. So those filing on day one might see their refund by mid-February. But now the additional processing time will delay those refunds until the end of February, Koskinen said.

http://www.nbcnews.com/business/consumer/irs-warns-tax-refunds-delayed-low-income-americans-n705656

 
 
 
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