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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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95 news items

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 ...
Fri, 16 Jan 2015 04:17:29 -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 ...
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 ...
Huffington Post
Wed, 24 Sep 2014 12:18:45 -0700

The Credit Repair Organizations Act (CROA), which is monitored by the Federal Trade Commission, doesn't allow credit repair services to ask for money unless they have completed services that were already agreed on. Some credit repair services ask for ...


Thu, 05 Feb 2015 09:34:44 -0800

It alleged that Midland violated the Credit Repair Organizations Act (CROA) by positioning itself as a credit repair organization, using language like “We can help you get back on track…” in collection letters. The plaintiffs contend that Midland ...
Law360 (subscription)
Thu, 29 Jan 2015 12:03:02 -0800

The plaintiffs would have had to prove that Midland was a credit repair organization for their allegations under the Credit Repair Organizations Act to have stuck, the judge said. Among those claims was that the company never provided them with a ...
MintLife Blog (blog)
Mon, 04 Oct 2010 16:47:36 -0700

According to the Credit Repair Organizations Act (CROA), the Federal law that defines how credit repair companies must do business, a credit repair company is actually referred to as a credit repair organization (or CRO). And a CRO is anyone who “sells ...
Dallas Morning News (blog)
Wed, 18 Jun 2014 14:45:00 -0700

The FTC charged in 2011 that RMCN and the Parkers violated the federal Credit Repair Organizations Act by charging up-front fees for a six-month program to improve consumers' credit ratings and by making “numerous false statements to credit bureaus ...

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