subject: The Uphill Battle Facing The Credit Repair Industry [print this page] There is a type of company that, even though it is regulated by federal legislation and has been helping consumers for decades, is among the most denigrated in the country. Even though many thousands of Americans have taken advantage of the services offered by the companies and individuals who comprise the industry, there are still people who are convinced that the whole industry is a farce and anyone who is a part of it is a con-artist.
After reading the title of this page, it is apparent that the industry we are referring to is the credit repair industry. Despite the fact that the oldest credit repair companies have been around for 20 years, that credit repair companies have been able to help Americans remove millions of negative items from their credit reports, and that Congress created the Credit Repair Organizations Act in order to regulate the credit repair industry and not to wipe it out, there are "experts" in the media, in major corporations, and in government positions who claim that any company who offers credit repair services should be avoided.
There are a few reasons why so many people believe credit repair is a scam. To start with, there have been many "credit repair" clinics that truly were out to dupe people. These clinics promised the world but ended up just taking people's money or in some cases getting them involved in credit repair schemes that were illegal. Left and right people desperate to improve their credit scores were getting suckered by these con jobs to the extent that the media and legal attention these clinics received was large enough to put a cloud over the entire industry. Instead of spending the time to distinguish the good services from the bad, a lot of people simply opted to accept that the entire industry was fraudulent.
And making this conclusion was pretty easy because there are massive institutions that benefit from your believing that credit repair services are not to be trusted. And who are these institutions? They are the credit reporting agencies (credit bureaus) who manage your credit report and the lenders who make use of your credit scores. The credit bureaus do not want people to try to clean up their credit. It's bad for business.
The credit bureaus make their money by receiving information about you, assembling it in a report, and then selling it. Credit repair creates additional work that costs them money and when you are dealing with hundreds of millions of credit reports, it would cost them dearly if everyone out there started trying to repair their credit. On the other hand, many lenders such as credit card companies don't want you repairing your credit because if you increase your credit score, they won't be able to demand as high of interest payments.
So, given the scale of the entities that would rather you didn't repair your credit and the fact that their profits are on the line, it is little wonder that when people try to confirm their concerns about credit repair companies, they are able to find plenty of information. Also factor in the huge budgets these organizations can dedicate to lobbying lawmakers and seeding stories in media outlets and it's clear why the amount of anti-credit repair information dwarfs the voice of the pro-credit repair crowd.
Combine these factors and it is easy to see why people are convinced there is no such thing as credit repair and why it is so difficult to persuade them otherwise.
Someday the situation may change. As more and more people are able to successfully improve their credit score with help from credit repair companies there are more people who know credit repair works to contend with the people who believe it does not. But until there are enough success stories to make a difference, those who do their research, find a reputable credit repair company, and work to clean up their credit will be the fortunate few because their credit scores will look that much better than those of the people who will do nothing.
