‘Credit Repair’ Operation Settles with FTC; Company Made False Claims and Charged Illegal Up-Front Fees

A federal court has ordered a credit repair operation and its principals to stop making false claims and requiring advance payment for credit repair services. The agreed-upon court orders are a result of a settlement between the Federal Trade Commission and the “credit repair” defendants.

The Commission sued the defendants in October 2008 as part of “Operation Clean Sweep,” a crackdown on credit repair operations. The defendants represented that they could remove negative but accurate information from consumers’ credit reports, including bankruptcies and late fees. According to the FTC, the defendants charged consumers up to $59.95 initially, then $59.95 per month, to send letters to credit reporting agencies disputing information on the consumers’ credit reports. Contrary to the defendants’ representations to consumers, those dispute letters failed to remove accurate negative information from the consumers’ credit reports.
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Reviewing your credit report after a bankruptcy is very important. You filed for bankruptcy because you needed a fresh start and your credit report should reflect all accounts included in the bankruptcy. After bankruptcy, you debts should be shown as zero and paid off, although the record of the bankruptcy is still there. This is a sort of balance which is positive on one side, and negative on the other. Generally, your ability to pay off a debt is increased after bankruptcy due to the absence of other debts. After a period of 10 years has expired, a bankruptcy can be written off your credit record.
Accurate Credit Reports after bankruptcy

This is extremely important. You would be surprised to learn that many individuals after bankruptcy still have credit reports that show outstanding debts. Whether due to laziness or carelessness, credit agencies often keep inaccurate information about your debts on their records. This misinformation will most definitely ensure that you never get any credit from anyone again.

To avoid this it is recommended that you request a free credit report within 30 to 60 days after your bankruptcy is complete and review it over the next several months. If you still have unpaid debts on your credit report you need to work with the creditor to update your credit report.

What does your rap sheet say about you? It reveals how prompt you are in paying back loans, how much money you could borrow should you decide to go on a spending bender, and how many times you’ve applied for credit. What it does not reveal is your salary, business debts (unless you personally guaranteed a loan), and whether or not you’re a generous tipper.

Your credit record also might not reflect all of your credit accounts — such as travel, entertainment, gasoline card companies, and credit unions — since some of these creditors do not supply information to the credit reporting agencies. Your deposit information, such as your saving’s account kitty, are not part of your credit report. An individual credit report does not contain your FICO score, as calculated by Fair, Isaac.

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