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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]

References[edit]

  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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105 news items

 
Business Wire (press release)
Thu, 21 May 2015 06:30:00 -0700

PERC released a study last month that found implementation of the Credit Repair Organizations Act (CROA) discourages interested consumers from learning more about their credit reports and scores, creating conflicts with other federal laws and public ...

InsideARM

InsideARM
Wed, 29 Apr 2015 08:54:40 -0700

... the Telephone Consumer Protection Act (TCPA), the Electronic Fund Transfer Act, the Fair Debt Collection Practices Act (FDCPA), the Homeowners Protection Act, the Fair Housing Act, the Credit Repair Organizations Act, the Employee Retirement Income ...
 
RealClearPolitics
Fri, 16 Jan 2015 04:17:55 -0800

Summary: Facilitating Access to Credit Act of 2015 Amends the Credit Repair Organizations Act to exempt from its coverage any consumer reporting agency (or affiliate or subsidiary) described under the Fair Credit Reporting Act as: one that compiles and ...

The Consumerist

The Consumerist
Fri, 27 Mar 2015 12:26:51 -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 ...

InsideARM

InsideARM
Mon, 30 Mar 2015 08:56:15 -0700

The FTC alleges that the company, along with employees Leyes, Bernal, Jimena Perez and Fermin Campos, violated the FTC Act and the Credit Repair Organizations Act (CROA). Specifically, defendants violated the FTC Act by misrepresenting that they ...
 
ConsumerAffairs
Mon, 25 Aug 2014 08:15:10 -0700

The unnamed defendants are charged with two counts of violating the FTC Act's prohibition on deceptive acts or practices, as well as two counts of violating the Credit Repair Organizations Act's prohibitions on collecting advance fees before providing ...
 
Business Wire (press release)
Thu, 23 Apr 2015 06:30:00 -0700

WASHINGTON--(BUSINESS WIRE)--A newly released study finds that implementation of the Credit Repair Organizations Act (CROA) discourages interested consumers from learning more about their credit reports and scores, creating conflicts with other ...
 
Courthouse News Service
Wed, 25 Mar 2015 08:00:00 -0700

... the president in 2010, so that all the negative, all the stains can be deleted," the FTC says. The FTC is not amused. It seeks an injunction and penalties for misrepresentation, deceptive trade, violations of the FTC Act and the Credit Repair ...
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