I finally got it. There it was, right in my Inbox. An email guaranteeing to improve my credit scores. I wonder what took so long? The "Can Spam" Act? Nah, that hasn't seemed to slow down anything. I guess it just took a while for someone to figure it out.

This is really a new variation on an old theme: credit repair. If you stroll down the aisles of most bookstores, you can see rows of books about consumer credit and how to "fix" bad credit. While most of the advice is standard consumer fare like "pay your bills on time" and "don't borrow too much" some try and use the system to get negative information off someone's credit report.

One of the tricks to get bad stuff removed from a report is to play the "30-day game" which works like this: The consumer sends an overnight letter disputing a negative item and hopes that the reporting company doesn't respond within 30 days. The rule is that anything that can't be documented on someone's credit report must be taken off. If there's an error and you dispute it, contact the company passing out the bad information and demand that they either verify their claim of bad faith on your part or remove it immediately.

The laws give such companies some leeway, in that they're given a little time to verifying the information you disagree with. This time frame is 30 days. If there's a collection account showing up on your report and it's not yours or it's not true, the reporting company has a 30-day period to prove what they're saying. If they can't, by law it must be removed.

The tricky part is hoping that the company won't or can't respond within 30 days. Some companies who charge for this service have all sorts of schemes to almost guarantee that verification can't take place within the required time frame by providing return addresses overseas or in far-off places. Even though the derogatory information might be correct, these companies have different methods to try and "trick" the system.

Now enter credit scores. The email I received just the other day made a similar claim … "We'll guarantee to increase your credit scores by having bad information legally taken off of your credit report." It's legal alright, as long as their tricks work. But the problem with having credit scores raised is that scores can't be re-calculated unless there's been a mistake corrected and the credit reporting agencies physically re-figure the credit score. This new plan doesn't work because scores don't automatically change when something is taken off the report. As part of their secret formula, credit scores look over an entire two-year history as part of their calculations.

If something is a mistake, sure, the score can be re-done, but if it's simply removed for a temporary period of time, don't expect anything to happen. This new scheme to increase credit scores is just another in a long line of consumer scams. Don't get taken in.

Published: December 17, 2004

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, a veteran Mortgage Banker, successful Real Estate Consultant and author of Your Guide to VA Loans, Mortgages 101: Quick Answers to Over 250 Critical Questions About Your Home Loan, Who Says You Can't Buy a Home!, and Mortgage Confidential: What You Need to Know That Your Lender Won't Tell You, is a former columnist and Contributing Editor with San Diego-based Mortgage Originator Magazine. Reed is President of CD Reed Mortgage Bankers, Austin, TX and is a Past President of the Austin Mortgage Bankers Association.