Guide to Understanding the Credit Repair Organizations Act

A Credit Article Contributed by Brandie King

You would like to know what your rights are according to the Credit Repair Organizations Act, but it is all full of hard to understand legal terms. The following article will deal specifically with the parts of the Credit Repair Organizations Act regarding what credit repair organizations can and cannot do.

Credit Repair Organizations Act: What Credit Repair Organizations Have to Provide You with and Tell You

Credit repair organizations are required by law to give you a copy of the "Consumer Credit File Rights Under State and Federal Law" statement before requiring you to sign a contract with them. This statement must be provided as a completely separate document from your written contract.

Credit repair organizations are required by law to provide you with a contract in writing that spells out completely your rights and obligations. Always read your contract fully before signing it.

Credit repair organizations are required to include the following information within your written contract. They have to include all payment terms that will be charged to you for their services, including the total cost. The written contract has to provide an extremely detailed description of what services they are going to perform for you and how long it will take to achieve the results. The contract also has to state any guarantees they offer as well as the company's name and business address.

Credit repair organizations are required to give you a copy of the signed written contract and copies of any other documents that they require you to sign.

Credit Repair Organizations Act: What Credit Repair Organizations Cannot Do

Credit repair organizations cannot make false claims about their services.

Credit repair organizations cannot charge you until after they have completed the services they promised you.

Credit repair organizations cannot perform any services whatsoever for you until they have your signature on the written contract and have completed a three day waiting period. They are required to allow you to cancel the contract within that three day waiting period without having to pay them any fees.

Credit repair organizations cannot require to to sign or agree to a waiver of the rights you have under the Credit Repair Organizations Act.

Credit Repair Organizations Act: More Information

Contact your local consumer affairs office, the attorney general for your state, or the FTC, if you have problems with a credit repair organization or feel that you have been scammed by them.

To access the full text of the Credit Repair Organizations Act on the Federal Trade Commission (FTC) website just visit the following website. http://www.ftc.gov/os/statutes/croa/croa.htm

The Credit Repair Organizations Act is Title IV of the Consumer Credit Protection Act. The full text of the Consumer Credit Protection Act can be found at the following website. http://www.fdic.gov/regulations/laws/rules/6500-200.html

For an extremely detailed and in depth discussion and explanation of credit protection laws, written in a way that is very easy to understand, visit http://www.federalreserve.gov/pubs/consumerhdbk/.