Jamming is a credit repair scam that will surely have you singing the blues. The tactic is used by unscrupulous credit repair companies for the sole purpose of squeezing you for cash for as long as possible. Jamming enables them to play you like a fiddle for months or even years – all under the pretense of removing negative information from your credit reports.
How jamming is played.
A credit repair company sends a flurry of frivolous dispute letters challenging every negative item on your credit reports – even if the items are accurate – to overwhelm the credit bureaus and “jam up” the system.
Under the Fair Credit Reporting Act, credit bureaus must review and respond to every dispute within 30 to 45 days or remove the disputed item from your reports. And that’s what these scamming credit repair companies are banking on. By burying the credit bureaus in a mountain of disputes, the credit repair company is betting on the fact that some won’t get addressed within the time frame – and will be miraculously “gone” from your reports – despite being legitimate bad debts.
Why jamming can sound like music to your ears.
Having bad debts deleted from your credit reports will give your credit scores a boost. You see your higher scores – and naturally it appears the credit repair company is doing a great job for you, right? Wrong. What you don’t know is that negative item you paid to have “gone” is by no means forgotten. If it’s a legitimate negative item, it will reappear on your credit reports with a vengeance.
Lenders and creditors report regularly to the credit bureaus (generally every 30 days). Unless your bad debt is legitimately resolved, it will not permanently disappear from your credit file. When the lender reports back, the disputed item (that’s now verified as correct) gets put right back on your credit reports and your credit scores take a dive. But you don’t know that – so you keep paying the credit repair company to remove negative items that keep coming back – and so on and so on. And that’s the scam.
Jamming always ends on a sour note.
Should you get flagged as someone who files bogus disputes to try to jam the system, you’ll have a very tough time getting the credit bureaus to take you seriously when you do have a legitimate dispute.
Jamming also affects people who are legitimately disputing items on their credit reports, as it clogs the pipeline and delays the resolution of honest disputes. This scam has been so pervasive that the Consumer Financial Protection Bureau (CFPB) released an advisory in September 2016 alerting consumers about potentially misleading credit repair services such as jamming. According to the advisory, consumers should be wary if a credit repair company claims it can get rid of the negative information on credit reports within a short period of time – even if that information is accurate and current – or if it promises a specific increase in credit scores or guarantees results.
The Federal Trade Commission (FTC) includes jamming as one of the five signs you’re being scammed by a credit repair company:
- Requires upfront payment before doing any work on your behalf
- Discourages you from contacting TransUnion, Equifax and Experian directly
- Instructs you to dispute all negative information on your credit reports, even if it’s accurate (jamming)
- Encourages you to falsify information on credit or loan applications
- Does not explain your legal rights
Don’t turn a deaf ear to the dangers of jamming.
As with most things in life, if it sounds too good to be true, it probably is. No one can legally remove accurate and timely negative information from your credit reports. Making legitimate corrections to your credit reports and building your scores takes time. Not only is jamming illegal and expensive, the long-term consequences will far outweigh any short-term results.