What the Credit Repair Organizations Act entitles you to

Who the law covers

The Credit Repair Organizations Act applies to businesses that, for payment, offer to improve your credit record or advise you on doing so. It is aimed at the done-for-you model, where a company acts on your behalf.

It was passed because Congress found that a meaningful share of the industry was selling outcomes it could not deliver, to people least able to absorb the loss.

What you are entitled to

These are not terms a company chooses to offer. They are statutory, and a contract that waives them is void.

• A written contract, before any work begins, stating the services, the total cost, and how long it will take.
• Three days to cancel that contract, without paying anything and without giving a reason.
• No payment before the promised services have been fully performed.
• A written statement of your rights, including that you may dispute items yourself for free.
• No untrue or misleading statements to a bureau, a creditor, or to you.
• No advice to misrepresent your information to anyone.

What nobody may promise you

No one may tell you they can remove accurate, current negative information, because they cannot. No one may guarantee a specific score increase, because the bureaus and furnishers determine the outcome. A promise of either is the clearest signal available that something is wrong.

There is also no lawful route to a "new credit identity". Being advised to apply for an employer identification number and use it in place of your Social Security number is being advised to commit fraud, regardless of how the offer is phrased.

Where software sits

A tool you operate yourself is a different arrangement from hiring a firm: you choose the items, you review the letter, and you send it, so nobody is acting on your behalf. You are paying for software rather than for a credit outcome.

That distinction is worth understanding whichever route you take, because it changes who is responsible for what. It is also a description of how the arrangements differ, not legal advice about which one suits you.

If something goes wrong

Complaints can be filed with the Consumer Financial Protection Bureau and with your state attorney general. Many states also require credit-repair businesses to register and to post a surety bond, which gives a second place to check whether a company is operating lawfully.