Credit Repair is an ongoing process, similar to the growth of any other system. A system that works perfectly will require periodic monitoring and regular reviews to make sure that the objectives of the system are achieved. The same is true for fixing one’s credit history, including understanding the various regions of interest which may be reported, identifying the numerous mistakes which may be made and learning how to fix credit score errors. One of the best ways to improve your credit score is through Credit Repair.
There are several areas that are commonly confused during the credit repair process, the first of which is inaccurate or incomplete information. This can result in quite a few problems, such as the inability to get approved for home, auto and business loans; being diminished for employment; having bad credit report ratings; not qualifying for insurance; not being able to get certain professional licenses; and a multitude of other problems. For example, missing data from a credit report can lower a person’s credit score by up to 200 points. The most common cause of this problem is the failure to report accurate information.
When there are no national laws to protect consumers from inaccurate or incomplete information, the federal trade commission has taken steps to ensure that all customers have access to fair and accurate reporting. The federal trade commission enacts many rules and guidelines to help Americans understand and avoid common mistakes and the negative consequences of these mistakes. By way of example, the three largest credit repair agencies in the United States must inform consumers of the differences between debt settlement and bankruptcy as well as the choices available to them. The commission also requires credit bureaus to provide consumers with reasonable notices regarding changes in credit scores, any negative action that may be taken against them and other important information. Among the biggest problems that consumers face is the inability to correctly understand the Fair Credit Reporting Act and its own rights.
Under FCRA, lenders are prohibited from making false statements about a consumer’s credit report. However, it doesn’t matter if those statements are true or not. As an example, it is perfectly acceptable for a creditor to report inaccurate negative information on a consumer’s credit report if that creditor reports that information to all of the credit reporting agencies. So, what if a consumer decides to question that negative information? Is it officially valid?
This is a tricky question. In theory, it would seem that a creditor has every right to include incorrect negative items on a consumer’s credit report. But that would mean that the creditor is practicing false advertising. Most credit repair companies dispute negative items on a consumer’s report. If the credit reporting bureaus take the dispute badly, the creditor will be asked to remove inaccurate negative things. But this will hardly ever happen.
Many credit repair services will simply instruct their customers not to take action to correct the problem. Why would they do that? If a creditor refuses to take action to correct inaccurate information, the credit bureau is under no obligation to remove erroneous information. The credit bureau can choose to investigate the dispute and take steps to investigate prior to making a determination. Then it might issue a letter to the creditor telling them that the information is inaccurate and need to be updated.
This scenario plays out over every day. A consumer decides to purchase a car and does a little bit of research to find out what the price will be. After talking with a trader, he makes the decision to purchase the car. A few months pass by and he predicts the dealer and says the cost he’s offered is much less than what he had been told. He asks for a refund and is told that he cannot get a refund because the credit report comprises an error.
The next step would be for him to send a letter to the credit reporting agency, disputing the errors on his credit report. If he had done this before hiring the credit repair company, he would have been able to make a formal dispute. If he had not had the help of the credit repair company, he might have had to try to make the dispute himself. By utilizing the services of a credit repair business, you’re given the advantage of someone else being able to assist you in this aspect of credit repair.