Common Mistakes

Avoid The Common Mistakes Most Credit Repair Companies Make

  1. False Claims and Deceptive Advertising.
    You see it time and time again. Companies over hyping their service by guaranteeing results and deletions and claiming a specific score increase. In this business, all you can talk about is the average results you’ve received for clients and under no circumstances should you forecast what kind of results you will get for the client.
  2. Charging in Advance
    CROA prohibits charging for any service until such service has been fully performed. This means that whatever service you are providing, you may not charge until said service is fully completed. Some companies are exempt from CROA so they do have the ability to charge upfront, but in our opinion it is a poor business decision to charge up front, even if you are exempt.
  3. Hard Pressure Sales
    In the credit repair business, consumers have 3 days, per Federal Law, to change their mind about your service. This one fact alone prevents “impulse” or hard pressure sales and allows consumers with “buyer’s remorse” the ability to attain a full refund. Educate the consumer on what your services can do for them and schedule a follow-up as necessary.
  4. Poor Client Support
    It’s amazing how many “companies” use their cell phone for client support and answer it in their car or at home with children, TV or radio blaring in the background. A professional credit repair company should standardize on a number for client support and make sure it is answered, in an office, between regular business hours. Document all conversations in your TrackStar sales CRM.
  5. Failing to Include Federal Disclosures
    Make sure you have all the disclosures CROA requires you to have. Too many companies fail to provide these and it is a very easy thing to implement.
  6. Not Advising Consumers of their Rights
    You are required by law to inform your consumers of their rights under state and federal law. Consumers can dispute information on their own and CROA ensures that you inform them of this in writing.
  7. Promising Results
    Any results that you promise to obtain for the client would fall under false claims because it is impossible to know what is going to happen on a consumer investigation. As stated above, all you can talk about is what you’ve been able to do for past clients. Also, do not talk about the one client for whom you’ve achieved great results and represent that as a normal everyday client. Talk about your entire client base and do not cherry pick. Keep things realistic and honest, and additionally make sure there is zero confusion.
  8. Failing to Set Realistic Expectations of Clients
    Under promise and over deliver. Make sure your clients have a realistic expectation of the credit repair process or you will be dealing with a lot of headaches and refunds for false claims.
  9. Improper Training
    Get NACSO Certified! If you are not NACSO certified then you are doing your clients and your industry a disservice. Train your employees on how to be compliant and get them certified as well.
  10. Advising Clients to Pay Off Collections to Increase Scores
    Paying on old collections accounts, if the original creditor is misreporting the negative item, will significantly lower a score by renewing the date of last activity. This is surprisingly not known by most companies and can be a detriment to your client base.
  11. Using/Purchasing Pre-Written Dispute Letter “Templates”
    A big problem in the credit repair industry is the flood of companies that have no idea how to effectively open investigation requests on behalf of the client. Many companies use prewritten dispute letters they have either purchased or found for free online. Effective credit repair is using your knowledge of the law to properly draft custom dispute correspondence on the consumer’s behalf. If you are not doing this, then consider outsourcing your disputes for a very nominal price and become 30-40% more profitable.

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