Credit report laws
What Is the Credit
Repair Organizations Act?
The
Credit Repair Organizations Act (CROA) was constituted in September 1996 in order
to shield the majority from unjust marketing and business operations by credit
repair agencies.
The Credit Repair
Organizations Act makes certain that possible consumers of credit repair
agencies are administered the correct information before they procure the
services.
Usually, the CROA
stalls the credit repair organizations from projecting false advertisements and
information. It also stops them from making a payment appeal before the
services are provided. The CROA also demands the organizations to form an
official contract with the buyer ensuring them of their services and the
ability to cancel their contract at any given moment.
CROA’s Credit Repair
Laws
Siding with their
customers, the credit repair agencies try to remove all inaccuracies that can
prevent the increase of a buyer’s credit score. For example, if someone
previously faced fraud or insurance billing that was not recorded with proper
HIPAA procedures, then the inaccuracies growing from those issues would be
acknowledged as errors and be eliminated. These eliminations take a substantial
amount of time as it depends upon the case and the number of inaccuracies in
the credit reports.
Illegal Credit Repair
Policies
According to the CROA
and the Consumer Credit Protection Act, there are a certain set of procedures
that the credit repair agencies must follow. These rules include:
1. Fabricating their services. It
is illegal for an agency to amplify their services and offers, like vowing
specific time periods or guarantee the removal of errors from the consumers’
credit reports. Credit repair is tailored to your case and can differ in the
time it may take to fix. It is not possible to promise any results.
2. Making fraudulent accounts of your
data to credit bureaus and such. A credit repair
company cannot falsify your credit information or encourage you to do so when
conveying your case to bureaus, creditors or lenders.
3. Affirming to change in your
identity or the fabrication of a new identity. It
is unethical and illegal for a repair agency to ensure the clearance of your
credit error with the formation of a new identity.
4. Demanding fees before the
provision of services. Credit repair organizations are
not permitted to demand their fees before their services are provided.
5. Needing you to abandon any of your
rights. It is illegal for a credit repair company to demand
you to waive any of your rights to utilize their services.
Legal Credit Repair
Policies
As well as restricting
the companies from several illegal policies, the CROA also declares that the
companies must be fully candid regarding their services to consumers. These
laws include:
1. Acknowledgement statement named
“Consumer Credit File Rights Under State and Federal Law”.
During the confirmation of the contract, the credit repair companies are
obligated to highlight your rights to regulate credit reports, find errors in
the information and have the ability to sue a company in case of violation of
the CROA.
2. An adequately structured contract.
The contract written up must outline all stipulations like the matter of
payments, the services undertaken, time period of the contract, your personal
information, and the procedures in case the consumer is looking to cancel the
contract with the company.
3. The ingenuity of cancelling your
contract after three days' time. Credit
repair companies have clauses in their contract stating that if the customer
wants to cancel the contract, they must do so in an allotted time to prevent
additional charges. In case of cancelling a contract, it must be done within
three business days to avoid any penalties or cancellation fees. This practice
must be clearly stated in the contract.
How Can I Ensure That
the Credit Repair Company Is Not a Scam?
Having adequate
knowledge of the CROA regulations can go a long way to ensure that your credit
repair agency is not a scam.
Make sure you are
vigilant when dealing with the demand of upfront payments, creation of new
identities, or limiting your knowledge of repairing your credit yourself. In
addition, any company that promises to deliver results in a specific time is a
scam. The time set to unravel a case depends on the case being reviewed and its
details. Time is not a universal quality when dealing with credit repair.
It is noteworthy that
if a contract is signed and the credit repair company violates the rules of
CROA, then the contract is automatically affirmed null and neither party is
obligated to fulfill the terms. However, if you find yourself in such a
situation, it is advised that you see professional legal help for proper
guidance.
Blackwater Credit
Repair affirms the belief that a payment must only be received after the
services are fully provided and all consumer rights are adequately utilized
including the Fair Credit Reporting Act, in order to receive the finest legal
action on your credit. And so, if you are on the lookout for legal help against
inaccuracies in your credit, contact us to see how we can be of service.