2008 was a tough year for credit repair agencies. In fact, the Federal Trade Commission shut down more than 30 businesses for violations of the CROA - The Credit Repair Organizations Act - which defines how credit repair agencies must operate. The trend has continued into 2009 as various state agencies and the FTC are on a mission to find those companies who continue to prey on unwary consumers and put a stop to their unlawful business practices.
Common violations include operations that charge an advance fee for credit repair services or provide misleading information by claiming they can remove negative information from your credit reports, even if the information is timely and accurate. The CROA also requires credit repair businesses to disclose that you can dispute information on your personal credit reports for free, without the help of a credit repair agency.
Like many industries, the credit repair business has it's fair share of both scammers and reputable firms. So, if you choose to enlist the help of a credit repair agency, be sure to do your homework and know the history of the company. In addition, you may want to visit our Credit Talk discussion forum to interact with thousands of members who might have valuable feedback regarding the company you're researching.
