Credit Repair Companies

Looking Into Credit Repair Guarantees and Warranties

Credit repair is never a sure thing. Even if you exercise every legal right available to you ranging from submitting credit bureau disputes to suing your creditors, there is no guarantee that you disputes will produce results or that you will prevail in court. Sometimes it doesn't matter what you do, a negative item will remain on your credit report for 7 to 10 years.

It is because of this fact, and the apparent biases against credit repair companies, that the FTC frowns on overly aggressive messaging from credit repair companies and is so quick to point out that you can remove "accurate" negative information from your credit reports (accurate is in quotes because case law has essentially defined accurate as meaning negative item you cannot get the credit bureaus to delete). Companies that too strongly imply that their credit repair services will definitely be able to delete negative information from your credit reports risk FTC sanctions for misleading advertising.

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BBB Ratings for Credit Repair Companies

This post is reprinted with permission. We are republishing it here because we feel it is an excellent post for Credit Repair BEST and a good explanation of why we do not use BBB ratings in our requirements for becoming a Credit Repair BEST Approved credit repair company. The original post can be found here.

The Better Business Bureau can be a good resource for checking out companies, getting a feel for how reputable they are, and seeing how they handle customer complaints. So, naturally, many people check with the BBB when researching credit repair companies, especially since there is so much talk about credit repair scams. But, it is when researching credit repair companies that the BBB can really let consumers down.

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If There Are No Legitimate Credit Repair Companies, Then Someone Isn't Doing Their Job

A while back, Steve Baker, the director of the FTC's Midwest region who spearheaded a crackdown of fraudulent credit repair companies in 2006 called "Project Credit Despair" made the following statement:

"I remember the head of our consumer protection bureau saying a few years ago [that] she had never seen a legitimate credit repair company, and I don't think we have yet."

An interesting statement that certainly begs the question: if, according to the FTC's bureau tasked with protecting consumers, there are no legitimate credit repair companies, why are there so many companies out there today offering credit repair services. If every credit repair company out there is a scam, why isn't something being done about it? And as an extension of that, if after being around for two decades the credit repair industry has yet to produce a single legitimate company, why are there federal and state laws defining how a credit repair organization can act instead of laws stating that providing credit repair services is illegal?

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What Does the Veracity Credit Consultants Lawsuit Mean for the Credit Repair Industry?

It's a case that anyone operating in the credit repair industry will likely want to keep a close eye on. On February 22, Colorado Attorney General John Suthers announced that attorneys from his office's Consumer Protection Section had filed a lawsuit against Denver based Veracity Credit Consultants, a credit repair company providing services since 2003. The lawsuit alleges that Veracity violates federal and state laws prohibiting credit repair companies from charging for services before those services have been performed, making misleading statements in marketing materials, and not providing proper disclosure to consumers.This will be a particularly interesting case because unlike other credit repair companies that have recently been shut down by the FTC, on the surface, Veracity appears to be one of the more legally compliant companies out there. Their general billing practices look to be in line with what is typical among many of the largest credit repair companies and there are certainly far more blatant examples of misleading messaging among other companies in the industry. While there may be specific illegal activities that set Veracity apart from other credit repair companies that have raised the ire of the Attorney General, they aren't highlighted in the court documents (PDF).

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