A credit repair service is an organization that helps individuals with the process of improving or repairing their credit score. Anyone who has a low credit score can tell you that bad credit affects almost all aspects of your life from buying a home to possibly even finding a job. Fortunately, it is possible to improve your credit with a credit repair service.

You can go through the process of credit repair on your own but it takes a lot of time and effort. If you employ a legitimate credit repair service their expertise and connections can save you an enormous amount of time but you will pay for their professional services. For most people, the cost is worth the time saved and the results achieved.

A credit repair service will work with you to challenge factual errors that appear on your credit report through a series of letters to the three major credit bureaus: TransUnion, Experian, and Equifax. By law, credit report bureaus must investigate any claims of inaccuracy and there are some studies that claim the inaccuracy rate is as high as 70% on most credit reports.

Credit Repair Service – The Law

Credit reporting agencies are required by the Fair Credit Reporting Act (FCRA) to correct or delete information that is inaccurate, incomplete, or unverifiable within a 30-day period of time. The credit repair service will “hit” the credit bureaus with letter after letter to achieve the deletion of this inaccurate, incomplete, or unverifiable information. It is often a slow but steady process that results in getting these bad marks off your credit reports.

To make sure you are dealing with a legitimate credit repair service, the Credit Repair Organizations Act (CROA) was signed into law back in 1996. This law requires a credit repair service to give you a copy of the “Consumer Credit File Rights Under State and Federal Law ” before you sign a contract. You must also be given a written contract that clearly spells out all your rights and obligations. You are then required to perform due diligence before signing any of the documents you are given. Ask questions before signing anything, if there is something you don’t understand.

Credit Repair Service – The Protections

The CROA law contains specific protections for consumers. It is illegal for a credit repair service to: make patently false claims about their services, charge you money before they complete the promised services or perform any services on your behalf until you have signed a contract with them and the three-day cooling off period has passed. You have a right by law to rescind the contract anytime before the three-day waiting period has passed without paying any fees.

Additionally, the CROA law requires credit repair service contracts to contain: the company name and address, a description of services to be rendered, the payment terms for the services with a specified total cost, the length of time required to achieve results and any guarantee the company may be offering. If the credit repair service follows the guidelines above you can be assured you are dealing with a true professional organization.