Credit repair scams are some of the most popular in the country. To that end, the Federal Trade Commission (FTC) “has brought scores of law enforcement” actions against bad actors. These scammers may promise they can improve your credit report—even if it’s already accurate. They may also charge hundreds of dollars in monthly fees for these “services,” which can consist of vague form letters to send to creditors.
The truth is, no one can force a creditor or reporting agency to change an accurate report. With all this in mind, here are some tips to stay safe.
How to spot a credit repair scam
Scammers can present themselves as anything from a legitimate law firm to a non-profit or no-name company. And according to the Consumer Financial Protection Bureau (CFPB), there are a few things you should watch for. Beware of anyone who:
- Pushes you to make an upfront payment: As the CFPB notes, companies shouldn’t ask for or accept payment unless their services are completed based on the Credit Repair Organizations Act.
- Says they can get negative information off your credit report, even if it’s correct: In reality, “no one can do this,” the CFPB warns.
- Won’t tell you that you can dispute errors for free: Disputing mistakes for free is your right under the Fair Credit Reporting Act.
- Discourages you from contacting credit reporting companies or doesn’t tell you that you can: Credit reporting agencies are readily available to discuss corrections with you.
As a general practice, also keep an eye out for anyone who contacts you and claims to be a credit repair counselor or a government agency. A good rule of thumb is that legitimate agencies require you to reach out to them first.
The truth about “goodwill letters”
A second route a credit report scammer may take is selling a “goodwill letter” form for you to submit to a creditor. These are letters consumers send to creditors to reverse an accurate negative report with credit reporting agencies. No creditor is required to do so but some may forgive the item out of “goodwill.” That said, remember you can always write a letter for free. And if you’re a Mr. Cooper customer, keep in mind that we do not act on goodwill letters, which we’ll explain in our FAQS.
How to find a real credit counselor
The CFPB suggests trying two websites to find a reliable counselor—the Financial Counseling Association of America (FCAA)and National Foundation for Credit Counseling (NFCC). You can also search a government-provided source, the U.S. Trustee Program’s list of counselors. From there, check the background on each organization you plan to contact with your attorney general’s office and consumer protection office. You can search for your attorney general at the National Association of Attorneys General’s website and for your state’s consumer protection office at USA.gov.
Finally, interview each agency—you can use the FTC’s list of questions to ask credit counselors. One key question to ask is, “What if I can’t afford to pay your fees or make contributions?” If an agency refuses services, the FTC says to move on. Real credit counselors may offer services for free or at a low cost, based on your financial situation.
Mr. Cooper’s credit repair FAQs
Now that you know the basics, here are a few tips for Mr. Cooper customers about working with us on credit repair requests.
Can Mr. Cooper remove a negative item from my credit report?
Mr. Cooper is required to accurately report payment activity to credit reporting agencies. That means if you have a legitimate delinquency, we can’t report otherwise. If this will be a problem as you apply for a new loan, see our tips below on ways to improve your credit score.
What can I do if Mr. Cooper made an error on my credit report?
If you believe there is a legitimate error in what has been reported to a credit agency, there are three ways to contact us:
- Open a ticket in the message center when signed in to your online account.
- Send an email to ResearchIncoming@mrcooper.com.
- Call our Customer Service Department at 888-480-2432. We’re available Monday through Thursday from 7 a.m. to 8 p.m. CT, Friday 7 a.m. to 7 p.m. CT, and Saturday, 8 a.m. to 12 p.m. CT.
Please provide details with your request so we can research your claim, such as the specific month(s) you believe the error occurred in and what you believe the error to be. If possible, include supporting documents, such as proof of payment and/or the page from your credit report showing the delinquency. *Do not send a copy of your original request letter if we request additional information. That will only delay a resolution.
Can Mr. Cooper increase my FICO® Score automatically?
No. Mr. Cooper and other home loan servicers have no control over your FICO Score. It’s determined by the credit reporting agencies.
What credit reporting agencies does Mr. Cooper report to?
We report to the following credit reporting agencies. Please be advised Mr. Cooper reports the same information to each. If you find an error with one versus the others, please contact that credit reporting agency directly.
- Experian: 888-397-3742
- TransUnion: 800-916-8800
- Equifax: 800-685-5000
- Innovis: 800-540-2505
What can I do to repair my credit?
The good news is there are plenty of ways to improve your credit. Some tips Experian recommends include:
- Keep paying debts on time: Payment history makes up 35% of your credit score according to their estimate.
- Reduce the amount of credit you’re using: They advise using “no more than 30% of your credit limit at any point.”
- Pay down debt: Creditors typically look at a borrowers’ debt-to-income ratios.
- Limit your credit inquiries: Also, be aware that hard inquiries—vs. soft inquiries—can hurt your credit score.
What if I want to refinance or get a new mortgage soon?
If you want to refinance or buy a new home in the short term, there’s more good news. Lenders like Mr. Cooper offer discount points that can reduce your overall interest rate, despite a lower credit score. You pay for these points (an additional cost) as part of originating your loan. Contact one of our Mortgage Professionals at 833-702-2511 for more information on this and other options that may be available.
Visit our Credit Score Resource Center
When it comes to credit repair, the best thing you can do is contact us directly. For more tips on credit repair scams and fixes, visit our Credit Score Resource Center.
Tradenames and trademarks used in this blog post are the property of their respective owners. Nationstar Mortgage LLC d/b/a Mr. Cooper is not affiliated, associated, or sponsored by any of these owners. Use of these names and trademarks is not intended to and does not imply endorsement, but is for identification purposes only. Information provided does not necessarily represent the views of Mr. Cooper. Information is subject to change without notice.