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The Credit Repair Organizations Act ("CROA") is Title IV of the Consumer Credit Protection Act. Despite its name, it is not actually an act; Section 401 states, however, it can be referred to as "Credit Repair Organizations Act". The statute was signed by President Bill Clinton on September 30, 1996[1] and was intended to prevent credit repair organizations from engaging in unfair business practices which result in financial hardship for consumers, particularly those of limited economic means or are uneducated.[2]

The purposes of the Credit Repair Organizations Act is to ensure that prospective buyers of credit repair services from credit repair organizations are provided with the information necessary to make an informed decision. It intends to protect the public from unfair or deceptive advertising and business practices by credit repair organizations. It enumerates prohibited practices, required disclosures, contract requirements, liability, and penalties for non-compliance and procedure to report non-compliance.[3][4]

One of the more important areas covered by CROA is how credit repair organizations can get paid. It is the general consensus that a credit repair company can only be paid after services have been rendered. This can be done using a monthly fee model where companies charge clients on a monthly basis after services are rendered or on the more modern pay after deletion model where clients only pay after items are deleted from the credit report. Companies that charge excess "setup" fees or all of their fees upfront violate the provisions of CROA.[5]


  1. ^ "15 U.S. Code § 1679 - Findings and purposes". Cornell University Law School. Retrieved 18 March 2015. 
  2. ^ "Credit Repair: How to Help Yourself". Federal Trade Commission. Retrieved 18 March 2015. 
  3. ^ "What Is The Credit Report Organizations Act?". Credit Marvel. Retrieved 18 March 2015. 
  4. ^ "Credit Repair Organizations Act (CROA)". Investopedia. Retrieved 18 March 2015. 
  5. ^ "15 U.S. Code § 1679b - Prohibited practices". Cornell University Law School. Retrieved 18 March 2015. 

Original courtesy of Wikipedia: http://en.wikipedia.org/wiki/Credit_Repair_Organizations_Act — Please support Wikipedia.
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263 news items


Thu, 28 Apr 2016 13:48:45 -0700

However, Credit Repair Organizations Act (CROA) restrictions on the national credit bureaus make it very difficult for consumers to receive this type of personalized credit counseling, as they are required to read consumers a lengthy legal disclaimer ...
PR Newswire (press release)
Wed, 20 Apr 2016 08:45:00 -0700

Specifically, the Coalition is urging Congress to fix the Credit Repair Organizations Act (CROA), so consumers can more easily get personalized credit education information and services from their credit bureaus without undergoing an onerous three-day ...
PR Web (press release)
Thu, 31 Mar 2016 00:06:54 -0700

The US government enacted the Credit Repair Organizations Act in 1996. Since then, many states have passed into law their own laws and regulations governing Credit Service Organizations, more commonly known as “CSO's”. Scoreinc.com is a member of ...

Automotive News

Automotive News
Sun, 21 Jun 2015 21:10:57 -0700

The federal Credit Repair Organizations Act makes any credit-repair product with upfront fees illegal anywhere in the U.S., the New York attorney general's representative told Automotive News. Lawyers who advise dealers say such products may be legal ...
Money Talks News (blog)
Tue, 09 Feb 2016 06:23:21 -0800

Know your rights: The Credit Repair Organizations Act (CROA) makes it illegal for credit repair companies to lie about what they can do for you or to charge you before they've performed their services. This law, enforced by the FTC, requires credit ...

The Consumerist

The Consumerist
Fri, 27 Mar 2015 12:35:48 -0700

According to the FTC, the company and employees, Maria Bernal, Guillermo Leyes, Jimena Perez and Fermin Campos, violated the FTC Act by misrepresenting their affiliation with the FTC and violated the Credit Repair Organizations Act (CROA) by charging ...

Bloomberg BNA

Bloomberg BNA
Mon, 21 Mar 2016 08:23:39 -0700

March 17 — State attorneys general and the Consumer Financial Protection Bureau are taking more aggressive stances against student loan debt-relief scams, but more resources may be needed to arrest the deluge of fraudulent schemes weighing down ...

The Consumerist

The Consumerist
Fri, 30 Nov 2012 11:45:38 -0800

Under the Credit Repair Organizations Act, credit repair companies cannot require you to pay until they have completed the services they have promised. * The company doesn't tell you your rights and what you can do for yourself for free. * The company ...

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