Understanding Credit Repair Laws in Wyoming
When it comes to regulating the state’s credit repair industry, Wyoming lawmakers look to the federal law to guide them in this task. The federal law, 15 USC Chapter 41, Subchapter 11-A, Credit Repair Organizations, clearly defines what credit repair can and cannot be in Wyoming as well as other U.S. states that lack their own set of credit repair laws. Wyoming residents who want to improve or cleanup their credit are encouraged to familiarize themselves with this U.S. code before signing a contract with a professional credit repair service.
The Purpose of Wyoming Credit Repair
The federal U.S. code mandates that credit repair in the state and in the U.S. can consist of any for-profit individual or business offering to cleanup or improve people’s credit ratings, histories, and records or any individual or business that provides advice or guidance to people wanting to make these improvements themselves. The law does not apply to individuals, businesses, or organizations like:
- Bankruptcy or collection lawyers and law firms
- Creditors that can reorganize or settle debts
- Credit unions
- 501(c)(3) non-profits
This law also is targeted at people or businesses who can help clients secure extensions of credit from creditors.
The Boundaries of Wyoming Credit Repair Services
People who have bad or compromised credit are often desperate to use any means available to remove the negative information from their credit files. Less than honorable credit repair companies take advantage of this desperation by promising to remove all bad credit entries and raise people’s scores.
However, the federal law stipulates that it is illegal for any credit repair business to make such guarantees because of how time consuming and complex it can be to dispute and remove negative details. The entire process can take months if not a year or longer.
Further, credit repair services cannot by law dispute negative information that is true. If people legitimately owe a debt, the information cannot be removed until the debt is paid and the statute of limitations for reporting it expire. Bankruptcies remain on a credit file for 10 years while other debts remain on people’s records for up to seven years.
Likewise, negative and factual information cannot be disputed simply to keep it from being reported to a person’s file. Federal law forbids credit repair entities from making such disputes for the sole purpose of temporarily raising a person’s score.
Similarly, credit repair services must use factual and accurate language when advertising to clients. They cannot make false claims about the speed or results of their services. They also must tell clients that U.S. law allows people to dispute and improve their own credit without paying another business or company for this service.
Why People Use Credit Repair Services in Wyoming
In reality, the process for disputing and removing information that is wrong as well as outdated, misplaced, or fraudulent can be complex and time consuming. The three major credit bureaus provide a step-by-step description of the process. Even so, many people may still not know how to navigate it successfully.
As such, people who lack the understanding or the time to go through the process from start to finish may prefer to pay someone to do it for them. By law, they cannot pay for the dispute services until each dispute is submitted and answered. However, in return for the payment, the service can make the dispute, make sure that the credit bureau or creditor provides a full answer to it, and either validates the debt or removes the entry from the person’s record.
Improving or cleaning up one’s credit rating, history, and record can take time and commitment that many people cannot afford. They may prefer instead to retain professional credit repair services to help them. Before they sign a contract or agree to any such repair services, people are reminded to learn about Wyoming’s credit repair services and how these entities are governed by state and federal law.