29 Aug The Credit Repair Organization Act – Beware Of Scams!
CROA, The Credit Repair Organizations Act
If it sounds too good to be true, it probably is. Especially in the case of credit repair companies. Scammers promise to make everything all better, instantly. We can’t promise you instant good credit. It takes a while to dispute errors, improve your credit score, and build new lines of positive credit.
We can’t erase your bad credit.
- We can help you build good credit.
We can’t give you a new credit identity.
- We can help you improve the one you’ve got.
We can’t make bankruptcies, liens, and past-due accounts disappear from your record.
- Unless they have been cleared up and date from more than 7 to 10 years ago.
What’s the purpose of CROA?
In 1996, the federal government created this law that protects ordinary people from deceptive and unfair advertising by credit repair organizations. Before the law passed, some businesses were promising miracles. They said they could get negative but true information removed from credit reports and dramatically raise credit scores. They did shady things like opening new credit accounts using ITINs instead of Social Security numbers. They demanded money up front and then shut down the business and disappeared without helping anyone but themselves.
CROA made a legal way for people to fight back when they were harmed by these practices. Credit repair companies now have stiff penalties for deceiving customers. Fines from a lawsuit in Texas ran up into the millions.
Why use a credit repair company if I can do it myself?
The Federal Trade Commission has a webpage telling consumers how they can set about repairing their own credit by themselves. Of course, it’s possible, it just takes time and patience. If you don’t mind spending hours on the phone talking to the credit bureaus and your lenders, and writing and mailing disputes, it will save you money.
But it will probably take months to resolve some problems. You may need to provide evidence, like canceled checks, to support your claims. And you need to be careful to not demand too many changes at once or you might get ignored. If you have an open dispute on your credit report, you probably won’t be able to get a loan or a mortgage until that’s resolved.
It’s kind of like asking yourself: “Why would I hire someone to do my taxes when I can just do them myself?” You have every right to do your own taxes and not pay for the service, but why do you think so many people hire a tax professional? The reason is that the laws are created to be confusing and vague, and they know that most people are going to spend the hours necessary to become tax law experts (which in this example benefits the government as you likely missing out on deductions and credits that you are unaware of). Credit repair is similar, it’s a system that is designed to discourage and confuse you. The Bureaus have tactics in place to combat individuals from disputing their reports and if you don’t have a steady hand at the wheel you might end up overwhelmed and give up.
Let us help be that steady hand! Call Honore’ Credit Consultants today so we can discuss options for helping to improve your credit profile! (844) 967-3724