How can you avoid credit score scams? These are 7 key ways (2024)

For example, one Ajay Sharma has a poor credit score of 550 and he now wants to improve it in the next one year since he plans to raise loan to buy a house.

He gets a link to an organisation that offers a guarantee of credit score improvement by 200 within three months. This sounds too good to be true. But the catch is that he is asked to pay ₹20,000 in advance. So, the best thing that Ajay should do is to stay away from such an offer.

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And in case you are not sure about a company or website that offers credit score services, you should make sure to research it thoroughly. It is recommended to look for reviews, ratings, and any complaints that are lodged against it.

These are the ways to avoid credit score scams:

Use official channels: Stick to official channels for obtaining your credit score, such as authorised credit bureaus of Cibil, Equifax and Experian. These agencies provide legitimate and accurate credit reports.

Beware of unsolicited offers: Be careful of unsolicited offers for credit score checks, especially if they are sent via phone calls, email or text message. Fraudsters tend to use such methods in order to lure gullible victims.

Check your report: You should monitor your credit report on a regular basis to detect any unauthorised activity or errors. You are entitled to a free credit report from each of the major credit bureaus once a year.

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Keep guaranteed results at bay: Stay away from the companies which promise to improve your credit score immediately or guaranteeing specific results. Genuine credit repair services may offer assistance in improving your credit, but they cannot give guarantees.

Stay updated: Acquaint yourself with common credit score scams and red flags to watch out for. Stay informed about new tactics used by scammers, and share this information with friends and family.

Secure your personal information: Protect your personal and financial information by using strong, unique passwords for online accounts, and avoid sharing sensitive details over unsecured networks or with unknown parties.

Report suspicious activity: If you suspect you have encountered a credit score scam or have become a victim of identity theft, report it to a law enforcement agency.

Frequently Asked Questions:

Does checking your credit report impact your credit score?

It does not impact your credit score. As a matter of fact, it is advisable to keep checking the score from time to time.

How can you improve the credit score?

You can work on improving your credit score by making timely payments, reducing outstanding debt, and maintaining a healthy credit utilisation ratio (CUR) before applying for a car loan.

How can you secure your personal information?

You can protect your personal and financial information by using strong passwords for online accounts, and you should avoid sharing sensitive details over unsecured networks or with unknown parties.

What are the agencies you should approach for credit rating?

One should only approach only the reputable agencies such as Cibil.

Why should one stay away from the ones that give guaranteed offers?

One should stay away from the agencies that promise to improve your credit score immediately or guaranteeing specific results. Genuine services may offer assistance in improving your credit, but they never give guarantees.SO

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Published: 17 Mar 2024, 10:46 AM IST