Credit Service Organizations

Credit Service Organizations are licensed under standards set by sections 407.635-407.644. These businesses offer to clean up and even to improve their prospective clients' credit reports and so are commonly referred to as "credit repair companies." The law applies to anyone who, for a consideration, offers to improve someone's credit report. There are numerous exceptions to the licensing rules: most lenders, lawyers, broker-dealers registered with the SEC, CPAs, and not-for-profit organizations per 501(c)(3). Among the consumer protections of the law are a three-day opportunity to rescind and limitations on collecting fees before the work is completed. Further, the statute requires numerous informative disclosures in the contract.