Why pay a credit repair company to do what a consumer lawyer will do for free?

Some people fear dentists, so they postpone taking care of minor dental problems until they become major dental problems. Some people fear lawyers, so they refrain from getting legal help as soon as a legal problem first crops up. As I explain in a prior post, part of that fear is based on the perception that lawyers charge too much money for their work. However, in the credit reporting area, that fear has no place. That is because lawyers who handle these types of cases typically do not charge their clients for their work; they expect the credit bureaus and the creditors to pay their fees, not their consumer clients.

Yet, because of that perhaps subliminal fear of high fees, many consumers try to solve credit reporting problems by going to a credit repair organization (“CRO”) instead of going to a consumer lawyer. Here I display my bias against CROs.

If you go to a CRO, you will have to pay them for their purported work. Some may even charge you up-front fees for their services (which according to the Credit Repair Organization Act they cannot). What will the CRO do for you? The CRO will do nothing that you cannot do yourself. Don’t take my word for it; see what the Federal Trade Commission says about CROs.

For your money, I anticipate that the CRO will send some letters to the credit bureaus for you disputing–hopefully honestly–the misreported information in your credit reports. Of course, this is something you should have already done (I assume you are reading this article because you have a credit report problem) and can do again, as I have explained here. Because your disputes did not work, the CRO’s disputes are not likely to work either. If so, then the CRO will refer you to a lawyer to file a lawsuit to fix your credit reporting problems. Gee, why don’t you save a step and save some money too: go directly to a consumer lawyer who will go to court for you and will not charge you for his/her work.

So you are stubborn; you still want to hire a CRO to fix the errors in your credit reports. Before you sign the contract with the CRO, I suggest that you at least ask the friendly representative two questions: (1) What can you do for my money that a consumer lawyer cannot do for free? (2) If your disputes to the credit bureaus do not solve the problem, what do I do next? My hunch is that the answers to those questions will lead you to hire a consumer lawyer who handles Fair Credit Reporting Act (“FCRA”) cases . . . for free.