Credit repair is one of the fastest-growing industries today. No surprises there. With more than 200 million active accounts being handled by each of the three credit reporting agencies, there are bound to be millions of credit accounts that need to be repaired. Make no mistake. The credit repair industry is a legitimate business with laws protecting both the consumer and the vendor.
But, like in any line of business, there are some individuals and companies that are out to take advantage of the desperate and the trusting. So here is how these laws protect the consumers and the industry as a whole.
The Fair Credit Reporting Act (FCRA)
This law laid down the process of credit repair. This is where organized credit reporting came from since an individual needs the reports to apply for credit. Here are some of the rights provided by the FCRA:
- It restricts who can view a person’s credit report, which is very important for security. In most cases, you would need to approve a company before they can view your report.
- It sets limits on what can be stated in the report. It sets the parameters on what should be listed and how long it’s going to stay there.
- It guarantees the accuracy of a report. If any part of the report is not accurate, then the person to whom the report belongs to can file a dispute without any charge.
- It outlines the steps to be taken when there are potential identity theft attempts.
The Credit Repair Organizations Act (CROA)
This law regulates the credit repair industry by allowing you the right to hire a third party to file disputes on incorrect items on your behalf. This law defines a credit repair organization as an individual or company that sells services maintaining the accuracy of the items in a credit report.
This law prohibits certain acts that might take advantage of the consumer.
- Credit repair companies will not be able to alter your identity or advise you to do the same in an attempt to hide negative items on your report.
- They can’t make incorrect statements regarding credit reports, like the results of disputes will be out in a week, or how their service can improve your credit score.
- They are prohibited from making incorrect accounts of what services they provide.
- They are not allowed to engage in acts that would otherwise be a fraud in other laws.
- They must perform all the services required before they can receive payment.
Under this law, credit repair companies are also required to disclose what their company does and how much the services cost. The disclosure is required before they submit a contract for signing.
Even with these and other laws that protect consumers, there are still organizations out there that are providing illegal services through unlawful processes. Fortunately, legitimate companies like Blue Water Credit far outnumber them. For reliable and quick credit repair service, call our highly-trained analysts at (916) 315-9190 or visit our website at https://bluewatercredit.com for a consultation.