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Credit Repair Company Selection Criteria and Considerations

The desire to repair your credit may end you up in the trap of different scams, which some companies have designed to take money from desperate clients. One way to avoid getting caught in one of these scams is to try to fix the credit on your own. You can always refer to one of the many non-profit credit counseling organizations if you don't feel comfortable with your knowledge and abilities. One of the non-profit organizations you can address for the needed counsel is the NFCC (National Foundation for Credit Counseling).

On the other hand, if you still don't want to manage the problem by yourself, you can select a company to do the job for you. If you are too busy or confused by the underlying process, select a credit repair company that meets the following criteria:

  • The payment for the credit repair service is done after the service itself is provided.

    If a company asks for its commission beforehand, move to the next one because this can be one of the many cheaters in the field.

  • The company informs you about the legal rights you have.

    Additionally, a legitimate credit repair company will give you information on the things you can do on your own, without incurring any expenses. 

  • The company should allow for the direct contact with a credit bureau.

    If a company tells you that this is not good, then it should serve you as a red flag.

  • The company doesn't suggest doubtful practices.

    If a company gives you such an advice as an application for a new credit identity, then you should question its ethics. File segregation is one of the scams that credit repair companies try to implement by involving their clients in infringing the law. An EIN is used lieu to a social security number under this scam.

    Additionally, the company may recommend the dispute of information that is accurate. The following of whatsoever other illegal advices may lead to prosecution actions against you.

Clients are protected by any deceptive practices and actions by the Credit Repair Organizations Act, which was signed in 1996. Before you sign any contract with a particular credit repair company, you have the right to receive a Consumer Credit File Rights Under State and Federal Law. In addition to this a document that lists your obligations and rights should be provided by the credit repair company.

The law bars credit repair companies from making any untrue statements regarding the services they provide to clients. Additionally, they should be paid the commission only after they have executed the needed service. Within three days after you have signed the contract you have the right to cancel it. Furthermore, during this time the company doesn't have the right to make take any actions without your signature on a written contract.

The company should give its full name and address in the contract. The total cost of the service provided as well as the terms of payment should be explained in the contract you sign with the credit repair company. It should also give detailed information on the services they promise to execute as well as the time needed for turning the promises into reality. The guarantee (if provided) should be stated in the terms of the contract as well.

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