The State of Massachusetts has its own laws governing credit repair companies. Chief among these laws is the prohibition of charging for services before they are rendered. Credit repair companies also aren’t allowed to shill for credit issuing companies. This is particularly true in situations where customers have poor credit and little chance of obtaining a credit card. For example, if Jane W. Public has a poor credit score, and her credit repair company offers to get her a credit card for a fee, that’s illegal. Further, companies aren’t allowed to coach their customers into lying to either credit bureaus or to their creditors in an effort to improve their credit standing. Lastly, they’re not allowed to lie to you and “promise the moon.”
When it comes to negative items on your credit report, the only ones that you’re allowed to dispute are those that are incorrect. For example, if someone steals your credit card and runs up a bunch of charges that you don’t pay, resulting in a charge-off on your credit report, then that’s a legitimate dispute. If you simply don’t pay your own charges, then it’s not a legitimate dispute. Any credit repair company that promises to remove legitimate negative items from your credit report is perpetrating a scam.
Each credit repair company must provide you with both a written contract and a list of your rights under the law. Those rights include:
- Reviewing your credit file at any time
- Disputing any negative item you surmise is illegitimate
- Reviewing your file free-of-charge as long your request to review it happens within 30 days of being refused credit for any reason
- Knowing how much it’ll cost to review it, should not ask within the 30 days
- Receiving a list of, and a set of prices for, all services to be performed by the credit repair company
- Cancelling any contract with any credit repair company within three business days of having signed it
You have additional rights in the State of Massachusetts under certain circumstances, such the right to have an upper limit on applicable fees, the right to additional disputes regarding negative items, and the right to both state and credit bureau oversight during any investigation into the negative items in question. Additionally, you might even have the right to file suit and/or collect recompense in cases where you’ve been damaged by improper reporting to any credit bureau. For example, if you had an outstanding debt and cleared it within the allotted time given to you by your creditor, and your creditor winds up not reporting your proper payment to the credit bureau in time, whether or not it’s accidental or malfeasant, resulting in a negative impact to your credit report, you could file such a lawsuit. Such a negative item on your credit report would also qualify as incorrect or improper and would be eligible to be disputed and removed.
In the State of Massachusetts, credit repair companies can also provide useful and helpful services, such as credit counseling, debt consolidation, and education about the process. The state also provides you with the opportunity to create a “security freeze” on your credit report, which would disallow any credit inquiries without your password-protected permission. This added security would protect you from nefarious people trying to take advantage of your good credit.