Credit Repair Services: Know Your Rights Under FCRA |
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The procedure used by credit repair services essentially involves disputing any negative information on your credit report with each of the three major credit bureaus, who have to investigate your dispute and if they cannot verify the accuracy of your credit report, they are bound to remove the stains from your credit report. There are many credit repair services that profess to be in a position to help you to repair your bad credit but you should know your rights under the Fair Credit Reporting Act (FCRA) as there are both upright and dishonest credit repair services. The Fair Credit Reporting Act (FCRA) gives every consumer the right to ask the credit bureaus to investigate any information in your credit report that you feel is inaccurate. The Act makes it mandatory for each credit bureau to maintain an accurate and verifiable account of your credit history. Moreover, the credit bureau must complete its investigation within a specific period of time (usually 30 days) failing which the disputed information has to be stuck off the credit report. However, if the information is accurate, the credit repair services cannot make credit bureaus remove negative information from your credit report. The credit bureau must ask each creditor to verify the accuracy of the disputed information and if the information is found to be inaccurate, the credit bureau has to update, correct, or delete each item. If the creditor fails to respond within a reasonable time, the item must be removed from your credit report. You can either repair bad credit on your own or hire any credit repair service. Credit repair services should either be a law firm or cannot charge until credit repair is done. These services must provide you with a detailed explanation of the process of credit repair, particularly your rights under FCRA and will not make false claims and have only minimal or no start up fee. The credit repair services should not repair credit until there is a signed contract and they have given you three days to reconsider your decision during which you can cancel the contract without paying any fees. Credit repair services should not ask you to make false statements on a loan or credit application, misrepresent your Social Security number, or get an Employer Identification Number from the Internal Revenue Service (IRS) under false pretenses. Moreover, credit repair services should only guarantee their performance and not their work as there is no guarantee that items will be removed permanently and no one has access to the credit bureaus' database. Accurate and verifiable information cannot be deleted. If you want to repair bad credit on your own, inform the credit bureau in writing, identifying each item and explaining why you are disputing the item. Include copies of supporting documents, give your complete name and address, enclose a copy of your credit report with the items in question circled and send the letter by certified mail, return receipt requested. Keep copies of the submitted documents. On completion of the investigations, the credit bureau must provide you the written results and a free copy of your credit report, if a change is made. If you request, the credit bureau must send notices of any correction to anyone who received your credit report in the past six months. You can also request that a corrected copy of your credit report be sent to anyone who received it during the past two years for employment purposes. Most bad credit will disappear from your credit report in 7 years, except bankruptcy (10 years), criminal convictions, and information related to employment. Creditworthiness can be improved by actively monitoring your credit report and taking the initiative to repair bad credit when a credit bureau reports misinformation as lenders and creditors only look at the last two to three years of your credit report. You must improve your credit rating, whether you do it yourself or with the help of credit repair services. |
