Is Credit Repair Legal?

Absolutely! It is your legal right to dispute items on your credit report. Credit repair companies exercise your legal rights pursuant to the Fair Credit Reporting Act, the Fair Credit Billing Act, Truth in Lending Act, and Fair Debt Collection Practices Act, as well as other applicable Federal statutes and state laws.

Credit repair is typically referred to as the process of disputing credit history items disclosed in a credit report. Under the Fair Credit Reporting Act, consumers have the right to request an investigation with the credit bureaus for any item on their credit report. The credit bureaus and the original furnisher of the information must investigate the claim within 30 days and report their results back to consumers.

Consumers may also submit statements explaining why they received certain negative credit marks. Congress passed amendments to the FCRA that went into effect in October of 1997 which improved consumers' privacy rights and further protected the accuracy of credit report information. For example, the revision made it a civil law violation for someone to obtain a consumer report without a permissible purpose. The amendments also state that when a consumer disputes information, the consumer reporting agency and the original furnisher of the information must investigate the claim.

The FCRA also states that a consumer can make a legal claim against, and sue the credit bureaus, creditors and debt collectors who report erroneous information. The Fair Credit Reporting Act offers specific consumer protections for people that are victims of identity theft. The law also allows you to request a reinvestigation of information in your file that you dispute as inaccurate or incomplete.

Everything on a credit report can be disputed, including bankruptcies, charge-offs, collections, foreclosures, judgments, late payments, repossessions and tax liens. Consumers should also look for incorrect personal information such as incorrect names, birth dates, addresses, former addresses, social security numbers, aliases, spouses name, etc.

Even though the FCRA is enforced by the Federal Trade Commission, the credit bureaus and some exploitative creditors still try to make credit report repair complicated and difficult. The process of credit report repair can be a difficult and frustrating experience for many consumers. If you decide to dispute items on your credit report please take the time to learn the relevant consumer protection statutes.

I strongly recommend that every consumer thoroughly read over and get a basic understanding of the Fair Credit Reporting Act (FCRA), the Fair and Accurate Credit Transaction Act of 2003 (FACTA) and the Fair Debt Collection Practices Act. You should also get familiar with your state's collection laws.