For those of you who do not know what a CPN is, please see my post, The Truth about CPNs.
So do CPNs work?
In this business, I have focused on Business Credit and how to build business credit, but the truth is many, if not most of the people that come to me for help have bad personal credit. One of the solutions to bad personal credit, offered by “credit experts” over the years were CPNs. Pre-2008, you could have bought a CPN(anywhere from $0-$2000), get some tradelines and bam, you would be getting approved for $10-$50K in credit in a matter of days. Times have changed. The banks have caught onto the game. I spoke to a CPN provider in NY about this, and he suggested that CPNs are now still good for(and I will take “good for” with a grain of salt) financing cars, getting apartments and getting very small credit cards. Now, when you use a CPN to apply for large lines of credit, it simply does not work. There are MANY credit repair services out there and a few that actually work. My suggestion is to get on the process of fixing your personal credit and give up on the quick fixes.
So are CPNs even legal?
Answering this question should be an easy one, but it seems that in desperate times, we humans believe what we want to believe.
CPN providers and credit specialist like to hide behind a lot of legal mambo jumbo, when it comes to CPNs. They site certain “rights” by law that one does not have to use your SSN(social security number) for credit purposes as an SSN was created for identification. A CPN or Credit Privacy Number was supposedly created to protect your SSN. Whether this is true or not is up for debate. I am yet to see the CPN issued by the IRS or any other government agency, BUT THE BOTTOM LINE IS THIS. When you walk into a financial institution to a apply for credit, or you fill an application out online, the application asks for a SOCIAL SECURITY NUMBER. At the bottom of the application, you also give a signature confirming that everything on the application is true, as far as you know. If you enter a CPN in place of an SSN, you willingly and knowingly lied on the application. This IS FRAUD and IT IS ILLEGAL. My suggestion(which in my opinion may NEVER work, but it is worth a shot if you have a CPN with good credit) is to cross out the SSN on the application and replace it with “CPN” to inform the bank that you are using a CPN on the application. This will take away the element of fraud, but the bank has no obligation to offer you credit, even if your CPN has an 800 FICO score, because they requested a SSN. This is similar to what was done on the Key Bank application, when we would cross out the SSN where they wanted a PG and write in DUNS and fill in your DUNS number instead.
I hope this makes everything clear on CPNs and I won’t have to answer too many more questions about this.