People who are struggling to improve their credit may feel helpless. Some companies take advantage of this stressful situation and defraud consumers by promising credit repair services. However, these services often charge a fee and don’t deliver on their promises.
The CFPB sued companies doing business as Lexington Law and CreditRepair.com. The two companies were among the largest credit repair companies in the U.S., promising to repair or improve people’s credit. The court ruled that the two companies violated the law. As part of the legal settlement in the case, the two companies are prohibited from using telemarketing to sell their credit repair services for ten years.
Some customers of Lexington Law and CreditRepair.com can cancel service without penalty
Thousands of customers of Lexington Law and CreditRepair.com received email notifications informing them that they could cancel their credit repair services without penalty and detailing the steps to take. The emails included an Internet link and phone number that you can use to cancel your account, as well as the following information:
Lexington Law and CreditRepair.com would like to remind you that – as stated in the attached Retainer Agreement – you have the right to terminate your credit repair services at any time, for any reason (or no reason).
Check your inbox for emails and take immediate action to protect yourself from illegal charges by Lexington Law or CreditRepair.com.
You have the right to see the results before paying
Under federal law, when a company uses telemarketing to sell credit repair services, they must meet certain requirements before they can charge a fee for their services. First, the company must provide the promised results within a specified time period. Second, the company must provide you with a consumer report showing the results, and the report must be generated more than six months after the results were claimed to have been achieved. Only then can the company charge you a fee or accept payment from you.
You don’t have to pay a company to repair or improve your credit
You can dispute errors on your credit report yourself for free. You do not have to pay a credit repair company to do this for you.
The first step is to get your free credit report from three national credit reporting companies at annualcreditreport.com. You can check your credit report online for free every week. Check the report to find errors. Then use our sample letters, videos and answers to frequently asked questions to help resolve the issues.
Errors can be investigated and resolved, but credit repair companies cannot legally remove the information if it is accurate and current. If errors on your credit report are not the problem, the CFPB has some advice on how to build and maintain a good credit score.
What can you do:
- Explore our online guides and tools to learn how to dispute inaccurate information on your credit report and improve your credit score.
- File a complaint about a financial product or service online or by calling (855) 411-CFPB (2372)
- If you work or have worked for a company and believe that the company has violated the federal consumer financial protection laws, please send your knowledge to whistleblower@cfpb.gov.
