Finding reputable credit repair companies can be a daunting task. Bad items on your credit report is bad enough, but being burned by credit repair scams, or at the very least by ineffective credit repair companies that employ the same old tired and antiquated methods is much worse.
In today’s article, I want to give you some things to consider before hiring a credit repair company. Unfortunately, bad people prey on vulnerable consumers by promising the world and delivering nearly nothing. Even if you don’t hire my company, Credit Wellness Solutions, I want consumers to be informed before signing up for credit repair services. Click the button below for a Free Consultation, or keep reading.
What A Reputable Credit Repair Company Looks Like
A good credit repair company will have several attributes you should always look for. If they lack any 1 of these things you are likely running into a company that is not legitimate, or at best, operating out of compliance. Don’t be afraid to ask questions or do a little research. Think for yourself and ask if better credit is worth risking being scammed, or even worse, takes your money and runs.
- Credit Repair Companies Should Always Advertise, Or Accept Clients From States They Can Legally Operate – Only a handful of states are loose with credit repair laws, many require surety bonds or licenses in order to operate. Try to shop the state you live in, using local companies.
- A Good Credit Repair Company Will Be Licensed, Bonded, Or Registered – If the company hasn’t bothered to go through the process of becoming a legal business, run as fast as you can! Even if they are boasting success with Credit Karma results on their Facebook page. Chances are, they are fake images from someone else’s work, or those results were achieved illegally.
- Clean Advertising – Is the advertising realistic? Credit Repair Companies should only advertise things they can actually do! Sweeping or wiping all negative items off of a credit report, or boosting a credit score 100 points in less than 30 days is not one of them!
- The Company Will Be “CROA” Compliant – The Credit Repair Organizations Act (CROA), is the national law of how credit repair companies do business. This regards how we can get paid, how we structure our contracts, and how we can advertise. CROA is a rather short law and can be found HERE. If the company isn’t compliant in this aspect, chances are it is one of many credit repair scams out there. Many state laws mirror CROA as well.
5 Things You Should Consider When Hiring A Credit Repair Company
Now to the meat and potatoes of this article. If this post helps to eliminate credit repair scams, or at the very least educate the public, and maybe those who have started a credit repair business, then I have done my job. Although, I want to do more business, educating the public and putting a stop to illegal credit repair practices far outweigh the exposure Credit Wellness Solutions gets.
- Is the company legally able to do business in my state? As mentioned above, many states require surety bonds, or licensing to operate. Do your research and find out if the company you are considering is legitimate. Ask for proof of their bonds, their licensing, or registration documents with the state. We will provide a listing of states that have loose regulation later in this post.
- What is the company advertising or promising you? Does their advertising sound realistic? Are they promising you a guaranteed number on your credit score, or the points they will boost it? Are they saying they will get ALL negative items off of your credit report? Consider all of these things before you sign up. Know that although it is possible, it is highly unlikely that your credit report will be “spot free” after the credit repair process.
- Are they asking for money upfront before they perform any substantial services? This is a major no-no! Advanced fees are illegal! A company may have “First Work” which is ok. They are preforming a service such as a credit report audit or personal info update for that fee. Also if the company uses an escrow service and asks for a deposit, that is also fine as they cannot receive any of that money until they prove the service was provided.
- What is the dispute method the credit repair company is using? A reputable credit repair company stays in a state of “continuing education” and stays on top of what is working and what is not. I will mention if any credit repair company mentions “609 credit repair, 609 dispute method,” or anything section 609 (other than failure of the credit bureaus to disclose a full disclosure credit report), and if any credit repair company disputes on a credit monitoring credit report (such as Smart Credit) and not a credit bureau direct credit report (those can be obtained from Annual Credit Report) I would consider shopping around, those methods are antiquated and are no longer effective. Consider a company who uses “Factual Disputing”, or “Pre-Litigation Credit Repair“. Those methods hold up in court or arbitration, and are much more effective.
- Should I hire a small company or a well-known large company? This is up to you, but I will mention, the large companies still employ antiquated methods, and they tend to drag consumers out for minimal to no results. Smaller companies tend to stay on top of their game to stay relevant. This means more thorough, faster, and personalized service.
States With Limited Credit Repair Laws & Regulations
As promised, I wanted to provide a listing of states with limited to no credit repair laws and regulations. It will not be uncommon to see credit repair companies from all states advertising or making their services available in those states. Knowing this, credit repair scam artists are well aware of this and capitalize as well. So be mindful of what I have mentioned above, and you should find a reputable credit repair company with no problem.
- Alabama
- Alaska
- New Jersey
- New Mexico
- North Dakota
- Rhode Island
- South Dakota
- Vermont
- Wyoming
I want to make a special note for residents of Georgia. Georgia is the only state in the country where credit repair is illegal altogether. You can still find credit repair though a consumer attorney, or from a non-profit organization. If any credit repair company approaches you, or you look around for credit repair, a reputable credit repair company will educate you on this law, and point you in the right direction. Credit Wellness Solutions does offer Free Consultations for anybody, regardless of what state they live, but we cannot service clients from Georgia. We strongly recommend you write your state representatives and demand credit repair to be legalized in your state.
I wish the residents of Georgia the best of luck in their fight for credit repair as Equifax, based in Georgia, has plenty of bribe money to sway your state’s politicians to strike down any notion of legalizing credit repair. They don’t want to lose one of their state’s largest employers.
Why Credit Wellness Solutions Is A Model For Reputable Credit Repair
I truly believe my company, Credit Wellness Solutions, is the future of credit repair, and the future is NOW. Reputable credit repair companies across the nation are discovering the methods that once got them deletions left and right aren’t cutting it anymore, nor their business models. Let me briefly share why Credit Wellness Solutions is ahead of the game, and how our method of credit repair will not only get you deletions, but could get you compensated for errors on your credit report. I also want to share why I believe our business model is also cutting edge.
- Pre-Litigation Disputes – Disputes based on fact, and points out every error on the credit report. By holding the credit bureaus and data furnishers to their own industry standard, Metro2, which was designed to ensure compliance with the federal mandate of “Maximum Possible Accuracy”. Each dispute builds a case for litigation, or arbitration against those who do not fix or delete the error loaded account.
- Credit Reporting Audits – This goes hand-in-hand with our Pre-Litigation Disputes. Metro2 is the credit industry standard set of rules for reporting consumer credit data. It was put in place to ensure compliance with the Fair Credit Reporting Act’s (FCRA) law of “Maximum Possible Accuracy”. We have the manual and know exactly how the tradeline on your credit report should be reporting. We have yet to see a credit report that is compliant with Metro2, let alone the FCRA.
- Debt Collection Audits – The Fair Debt Collection Practices Act (FDCPA) governs debt collectors. We find they violate the law fairly often. Each violation can be worth up to $1,000 each. If we find violations we forward your case to our attorney network for legal action.
- Escrow Payment Transactions – You never need to have a credit card on file at Credit Wellness Solutions, we use Escrow.com or CREDZU for payment transactions with our clients. This is KEY and cutting edge for the credit repair services industry. Here’s why. The client has full control over funding the escrow account, and approving transactions. Also the escrow company will not disburse funds to the company unless the work has been performed according to the service agreement.
- Client Choice In Everything! – We offer our clients choices in everything. Clients can choose their credit monitoring, level of service, and how we get paid for our work.
I hope this article was informative. Regardless of business, I want to ensure the general public is informed, and armed to make an educated decision. If you do run into a credit repair scam artist, be sure to report them to your state’s attorney general, you can also report them to the Federal Trade Commission (FTC), and the Consumer Finance Protection Bureau (CFPB).
