Tax season is approaching, and if you’ve been reviewing your finances, you might be looking for ways to address outstanding debts. Better Business Bureau® (BBB®) has tips for researching credit repair and debt relief services before you hire anyone.
Debt-related services come in many forms:
- Credit counseling firms offer educational programs to help solve financial issues.
- Debt consolidation businesses offer loans to pay off debts all at once.
- Debt relief or settlement companies can renegotiate payments with debtors.
- Credit repair agencies promise to fix past mistakes on your credit report such as bankruptcy or late payments.
Not all businesses promising to help you repair poor credit are scams; however, companies that offer quick fixes or make unrealistic promises can be a front for scams that disappear with your hard-earned money.
“Finances are often the root cause of major stress for many people, and for that reason a promise to magically fix your debt or credit score can be tempting,” said Michelle L. Corey, BBB St. Louis president and CEO. “Credit relief takes time and work. Someone promising you instant results probably doesn’t have your best interests at heart.”
Some debt-related companies charge fees to perform work you could do on your own or promise the impossible. While consumers have the right to correct inaccurate information on a credit report, no one can remove accurate information that happens to be negative.
However, this doesn't stop scammers from promising they can totally repair credit or eliminate debt for a fee. In 2025, 422 people reported debt repair scams to BBB, losing a median amount of $450. The top method for scammers to contact their targets was phone calls. BBB’s 2023 in-depth study on debt relief found that consumers who reported debt-related scams to BBB between 2020 and 2023 lost a total of $2.4 million.
In March 2025, a Hollister, MO, consumer lost $1,550 to a credit repair scam. She was contacted by scammers who created a realistic-looking website and social media accounts, posing as a legitimate credit repair service and promising to improve her credit report. She reported that they were very convincing and showed her false testimonials from “past customers,” then tried to charge her upfront frees to proceed with credit repair services.
What are some red flags when choosing a credit repair or debt relief service?
In general:
- Poor reviews or complaints online. See what other people are saying about a company before you hire them. Check BBB.org to see if the company has a pattern of complaints, whether its reviews are positive or negative, and whether it is BBB Accredited.
- Asking you to pay in advance or saying they need your bank information right away. In the US, credit repair and debt relief companies can only collect fees after they perform the services they promised. Don’t give a company your bank information unless you have researched them and are certain they are legitimate.
- Guaranteeing to erase your debt. Nobody can guarantee to make debt go away or improve your credit score. It’s an extra big red flag if someone promises this before they’ve even reviewed your personal financial situation.
- Making other big promises. These include removing negative information from your credit report or urging you to get a new identity or apply for an Employer Identification Number to use instead of your Social Security number (which is illegal). Don’t rely on verbal promises, either – make sure to get a written contract.
For specific types of debt-related services:
- Debt consolidation: Trying to convince you to stop paying debts to begin the settlement and promising they can settle with any creditor.
- Debt relief or settlement: Using credit reports to consolidate debts you didn’t discuss with them, using high pressure to get you to consolidate quickly, and hiding or downplaying consolidation fees.
- Credit repair: Failing to provide holistic advice for improving your credit, guaranteeing a higher credit score, and making big promises about the type of issues they can address.
What can I do if I think a company has taken advantage of me?
- Report it to BBB Scam Tracker or file a complaint to help keep others informed. You can also report it to the FTC and your state’s Attorney General.
