Above is an attorney who specializes in credit repair and reporting disputes explaining the pitfalls of credit repair organizations.
Consumer Alert Regarding Credit Repair Organizations!
According to many sources, this type of organization is prone to scamming consumers with the usual debt service motto, “Let us (professionals) handle your credit repair for you.” And to that, CROs add, “you don’t have time, let us do it for you.” CROs front-end load their fees, so you pay before you see any results.
It is generally accepted that any consumer can do a better job of credit repair on their own today, than credit repair organization can do for them.
Due to a high level of fraud and phony guarantees, CROs were regulated by the federal Credit Repair Organization Act in 1996.
CROs got started and grew for the same reason debt collectors and debt service firms grew; opportunity brought on by the significant increase in consumer debt over the past decades. Steve Baker, Director of the Federal Trade Commission in Chicago, said in the past four years (from April 2003) the FTC had not seen a legitimate credit repair clinic. You can read Baker’s other comments and some danger signals to note when dealing with CROs at bankrate.com. http://www.bankrate.com/brm/news/cc/20011008a.asp.
The proper letter to a debt collection agency or collection attorney can ward off debt collectors AND protect your credit rating. You can access that letter in my educational materials.