Starting a credit repair business is no different from any other business. You need a business plan, you need to have an income plan in place, and you need to ensure that you are following the law. This article will help you with this last part when you start your credit repair business.
Everyone remembers the stories and companies that make the news for stealing people’s money, or taking people’s money claiming they can miraculously make their credit problems go away.
However, as long as you know and follow the laws put into place by the Federal Trade Commission (FTC) you will be able to start your credit repair business the right way, legally and ethically.
But you are a smart business person. You are building your business on a legal and ethical foundation. Helping someone repair their credit gives them a possibility at a better life, where they can actually buy a home, or finance their next car at a rate they can afford. You are helping people. And when you work under the law, you are doing a good thing for other people.
Your future clients are good people who have simply made mistakes with their credit. And you will be able to build an amazing business, one that will pay you more than your dead end job, by helping your clients.
To protect consumers from scams and unethical businesses, Congress created a fourth section to the Consumer Credit Protections Act. In 1996 President Bill Clinton signed the Credit Repair Organizations Act into law. The entire document of the act can be found here.
If you want a lasting business that will provide you with income for a long, long time then you will want to become very familiar with the laws. These laws are in place to protect the consumers, and gives you guidelines to build your credit repair business, so that you too can improve your life.
The credit repair business opportunity is an amazing way for you to help people while also building up your own business and allowing you to leave your dead end job. To do this, you need to be sure that you are building a legal and sustainable business that will provide you with a consistent income for a long time.
The keys to following the law
Here are the key federal and state laws your business must follow when starting your credit repair business opportunity:
– First, the disclosure needs to be sent to your client before you have them sign the contract. Again, the exact wording, as well as exactly when you should be sending each document to the consumer, is available in the Credit repair organization act. However, our credit repair software, Client Dispute Manager, has them already set up and ready to be sent automatically to your future client without you having to do anything.
For example, Section 405 of CROA states that you must give your potential client the full statement of disclosure before you enter into any contract or agreement for a contract. Do not even agree to help someone with their credit until you send this disclosure. The exact wording you need to send to your potential client is provided in SEC 405 of CROA.
The Credit Repair Organizations Act helps protect consumers from fraudulent and deceptive credit repair companies. As you are starting a credit repair business, these are the exact laws you will need to follow. So get familiar with them now to make sure that you don’t accidently break the law.
– Second, CROA also says that your business must also send the disclosure separate from the written contract, or any other contract, or from any agreement for services. The law ensures that buyers of credit repair services are properly informed, and given enough information to make their own informed decision regarding the best way for them to repair their credit.
Luckily for you, all of this information is already included in our credit repair software, Client Dispute Manager. These are the two pieces of information that must be sent to your future customer before you enter into any sort of agreement to assist with their credit repair process. Both of these documents can be set up to be sent automatically to anyone entering your email funnel via your credit repair business’ website.
Further, the second document that must be sent to your client is the Right to cancel form. In Section 407 of CROA is the Right to Cancel. What this section says is that the client can cancel any contract with any credit repair business by notifying the credit repair specialist that they want to cancel. The client has three business days from when the contract starts to inform the credit repair specialist they want to cancel.
The credit repair business is responsible for sending two copies of the “Right to cancel” separate from the contract itself. This is a vital step to remember to send these two forms separately from the contract, it cannot be included in with the contract.
– Lastly, the Credit Repair Organizations Act also requires credit repair companies to not use any deceptive language in their advertising. The law also prohibits the credit repair business from charging all of their fees up front before they have provided any services.
These laws are so vital to follow; you do not want to be the next company to end up in your local paper for scamming your customers. Unfortunately, in can be easy for good people to make mistakes and unknowingly break the law. However, as a business owner it is your responsibility to educate yourself fully about this topic so that you are not accidentally breaking the law.
How our software can automate this process
It is so important that you follow each law and do not violate them in your credit repair business. Again, our Client Dispute Manager software includes this feature to send automatically to your future client. In the software, you set up the process one time and then set it to run automatically. Whenever you enter a new customer into your software, it will automatically send the correct information to their email – even while you are sleeping.
When a customer finds you and your credit repair business through your website, they sign up for your services and the Client Dispute Manager software will automatically send the disclosure to them via email. Further, your client can not only read, print, and save the disclosure. They can also sign the disclosure agreement right into the document.
You can then also save and print their signed disclosure so that you can always be compliant with the law and with CROA. Lastly, once your client signs their contract for your services, our Client Dispute Manager Software will automatically send them their two copies of the Right to cancel. The entire process is automated for you with our software.
Companies can charge either monthly service fees, or pay per deletion – meaning the customer will pay for the service once a false or inaccurate item is deleted from the customer’s report. Companies cannot promise the customer a brand new credit report, or to wipe their slate clean of all negative information including the correct negative information. Only incorrect negative information can be deleted from a customer’s credit report.
In addition, the customer must also be made aware that they can in fact do all of this themselves, for free. However, this service offered by your credit repair business allows your future clients to continue their busy lives without the hassle of the many phone calls and legal documentation needed to repair one’s credit report.
The Federal Trade Commission (FTC) outlines exactly what you must inform your clients of before any contract is signed. You can learn more about the Credit Repair Organizations Act on the FTC website here.
State laws on running a credit repair business
Each state has its own laws and what you must do start a credit repair company and the company must follow those laws
So, now you know the federal laws regarding starting your own credit repair business. Next, you also need to do your homework regarding your own state’s laws for running a legitimate credit repair business.
Each state is different and it is up to you to know your own state’s laws regarding what you can or cannot do as well as what you can charge – and when you can charge it. Be sure that you know this information before you start your credit repair business. Ignorance is not bliss when it comes to the law.
Each state also sets the maximum you can charge a client each month, be sure you look at your state’s maximum monthly fee. Some states limit you to a $50 set up fee and then a set monthly amount thereafter. In the first month, usually you can only charge the minimal set up fee. Then, in the subsequent months, you will charge the recurring fee.
By researching your own state, and knowing what you can and cannot do, you will ensure that you are building your business on the correct side of the law. This recurring fee provides you with an amazing credit repair business opportunity in the fact that you will get recurring passive income paid to you each month from your clients.
The more clients you work with, the more you can make each month. And with our Client Dispute Manager software, it is very feasible to scale your credit repair business to hundreds of clients allowing you to write your own paycheck each month.
Be sure you are building a long-lasting and successful business that will pay you for years to come. By being completely transparent with your future clients, disclose your full fees on your website, and do not charge any more than the maximum amount as allowed by your state you will be building a legacy and not a scam.
Don’t be these people and end up in the news for “unscrupulous” business. Be sure to give fair and honest information to potential clients. You can’t promise a specific credit score or charge up-front fees for your services. Do not promise a fresh start or a new credit score, this is illegal. Also, you cannot dispute accurate negative information as the people in this article did.
Take the time now to do your research so that you can rest at night knowing that you are building your credit repair business the right way. Building a business on a solid foundation – one that is on the correct side of the law – can also change your life as well. Are you tired of clocking into your dead end job and never having any extra money to do anything fun in your life?
Then starting a business with recurring income can change your life too. What better way to earn your money than to help people change their lives by assisting them in improving their credit score.
Click the link to get your free 30 days trial of the Client Dispute Manager software for your new credit repair business.. You will be able to work with the entire program, and most importantly you will be able to make sure that your credit repair business is compliant with the Credit Repair Organizations Act.
Keeping your business on the right side of the law will ensure that you will be able run a successful business for a long time. Starting a credit repair business is an amazing opportunity for both you and your clients. And our Client Dispute Manager software will help you build a profitable, and legal credit repair business.
Bonus: Now that you have read this article, why not take your new skill and start your own credit business helping others? We have free training that can help you do just that.
Click here to learn more.