Credit repair is the active process of taking positive action to improve your credit score by removing inaccurate, erroneous, or unverifiable information. If you’re struggling to fix your credit, legal credit repair is a great option.
Legal Credit Repair
Federal law protects legitimate or legal credit repair services. The Fair Credit Reporting Act requires credit bureaus to provide fair and accurate credit history information.
If you discover incorrect information on your report that’s causing your score to drop, you have the right to get it examined and removed.
The Credit Repair Organizations Act was also passed by the federal government. This law regulates how credit repair businesses conduct their operations, including how they promote and price their services.
Most states have rules governing the credit repair industry as well. States’ regulations may demand special licenses or bonding, or they may regulate the rates for a particular service.
Your options for Legal Credit Repair
If you’re feeling the pressure of bad credit you have two options to help you with your credit problems:
DIY credit repair – The first option to repair your credit is DIY credit repair. You can educate yourself about the factors that affect your credit score and write your own credit dispute letters.
A DIY credit repair is a great option for anyone who wants to get their credit back on track without hiring a credit repair service.
Legal credit repair company or organization: Your second option is to hire a credit repair service. A credit repair company is a business that can help you with understanding and repairing your credit by analyzing your credit report and disputing errors with credit bureaus and creditors. Credit repair companies will put their experience and expertise to work for their clients to improve their credit scores.
Because of that expertise, it simplifies the credit repair process for consumers. Because these companies know where and what to look for. They can assist you in developing a plan to repay your lenders and creditors, as well as a budget to help you manage your spending.
In simple terms, a credit repair company is a great option for you to have if you don’t have the time and you don’t have any idea about credit repair, because credit repair companies will do the work for you so you can improve your credit score.s
But when you’re considering a credit repair company to help you with your credit problems, Understanding what is legal can greatly help you in identifying fake credit repair companies. These companies operate almost like scams, taking your money and giving you very little in return. When choosing a credit repair company, look for the following major red flags.
4 Signs to look for to avoid illegitimate credit repair companies:
- They do not inform you of your legal rights.
All credit repair contracts must be in writing, according to the CROA. Also, credit repair companies are required to provide you with a written statement outlining your rights. If you do not receive either of these in writing, you should consider finding another credit repair partner.
- They guarantee that an accurate negative item will be removed.
No company can guarantee that items on your credit report will be removed. They can only assist you in making your case for the removal of inaccurate, unverifiable, or erroneous items. Credit bureaus and creditors will handle the rest. It’s a red flag if a company promises to remove accurate items.
- They somehow violate the Credit Repair Organizations Act
If a company violates the Credit Repair Organizations Act (CROA), it is most likely not a legitimate credit repair business. Companies are prohibited from making false statements to credit bureaus or creditors, falsifying data or ID to keep information off a consumer credit record, or misrepresenting services to consumers under CROA.
“Legal credit repair” is a way and process of repairing or improving a credit score without violating the rules and regulations on credit repair by CROA. Whether you will do it yourself or you will hire a credit repair company to do the work for you.