Credit Education » Report Basics » Credit Repair

Credit Repair

There isn’t anything that a credit repair service is able to legally do for you — even removing wrong information — that you can’t do for yourself for little or no expense. The cost of using a credit repair company can be considerable, ranging from hundreds to thousands of dollars.

Know Your Rights Before You Pay a Credit Repair Company

You have the right to work directly with a credit reporting agency to challenge any inaccurate or incomplete information in your credit report.

Be Familiar with the Credit Repair Organizations Act

A federal law that became effective on April 1, 1997, was created in response to the number of consumers who have suffered from a credit repair scam.

Under the act, credit repair service companies:

  • Are prohibited from taking consumers’ money until they fully complete the services they promise.
  • Are required to provide consumers with a written contract stating all the services to be provided and the terms and conditions of payment. Under the law, consumers have three days to withdraw from the contract.
  • Are forbidden to ask or suggest that you mislead credit reporting companies about your credit accounts or alter your identity to change your credit history.
  • Cannot knowingly make deceptive or false claims concerning the services they are capable of offering.
  • Cannot ask you to sign anything that states that you are forfeiting your rights under the Credit Repair Organizations Act. Any waiver that you sign cannot be enforced.