Are you so good at keeping your credit score excellent that you believe you can make a living out of it?
If your answer is yes, you are one step closer to your new career.
Our guide to becoming a credit repair specialist will teach you the ropes and show you what it takes to become one. Feel free to have a look and decide if a career in credit repair is the right move for you.
Personal Skills
The dedication and effort necessary to become a credit repair specialist go beyond the discipline and attention to detail needed to maintaining your own credit. Your clients will entrust you with their financial and personal information, so you need to possess a high level of responsibility and integrity to be successful in this field.
Furthermore, to become a credit repair agent, excellent communication and negotiation skills are a must. A large portion of the credit repair job is written correspondence with the reporting credit bureaus, and your clients need you to represent them professionally. Remember, they can contact the bureaus themselves, but they hired you because they expect you to do it better than them.
Finally, to become a credit repair consultant, specialist, or agent, you must be ready to continuously learn and upgrade your knowledge and skill set. As in many other fields, continued education is highly encouraged in credit repair. New laws and regulations are constantly being implemented, so you will need to stay updated with the latest guidelines to remain compliant.
Credit Repair Education
While there are no specific educational requirements for becoming a credit repair specialist, an economy or accounting background can definitely be advantageous. Considering that the better part of Americans working in credit repair have a minimum of a bachelor’s degree in a financial field, you will need a higher education level to keep up with the competition.
In addition to the credit repair specialist training, you can certainly benefit from courses in personal finance, like bankruptcy, taxes, or other subjects related to the consumer credit industry. Furthermore, additional credentials like a certified public accountant, or a law degree can fast-track your career in credit repair and even allow you to provide an extended range of services to your clients.
Credit Repair Training and Certification
While credit repair certification is not a legal requirement to start a career in credit repair, and technically, getting it is entirely voluntary, in a way, it is still necessary. A certified credit repair specialist has a nice ring to it and lets your potential clients know that you went the high road and got a special education because you are determined to be the best.
Moreover, you will be competing with people who have the credit repair specialist certification, which can be hard if you don’t get it yourself. In summary, the certificate may be optional, but it is definitely preferable to get it. And besides a financial setback of a few hundred dollars, there are no downsides to getting it, and the benefits are worth it.
You should look at the credit repair specialist training as a way to upgrade your knowledge and not just an exam you need to pass to get a certificate. In addition to helping you build integrity, the training will help you understand the industry better and reveal to you what exactly does it take to be a credit repair specialist.
And since the certification is voluntary, this means that you can choose exactly which training you would like to take part in to get it. One quick Google search will find you dozens of programs available both offline and online, and you can choose the one that best suits your criteria, budget, and schedule.
Even though you can become a certified credit repair specialist without too much effort and intensive learning, you should know that certain programs require continued education to maintain your certification. In our opinion, these are the best courses to take, as they encourage continuous learning and help you stay updated with the latest trends in personal finance.
Credit Repair License and Laws
Whether you want to become a credit repair specialist and find work at an agency, or you want to start up your own business, you must know the local, state, and federal laws associated with the job.
Laws for Starting a Credit Repair Business
Some US states require a special license for starting a credit repair business, others have registry requirements, and if you are planning on meeting clients in your home, there are the home business licenses to consider.
For more information on how to get a credit repair license and whether or not it is necessary for your state, you can visit the official website of the attorney general’s office. For information on registration requirements, you can visit your state’s Department of revenue website.
Regardless of the state your business will be based in, you will need to get tax identification numbers and report your income to state and federal governments. Additionally, in some states, you will be required to get liability or some other type of business insurance.
Laws Applicable to All Credit Repair Specialists
Even if your goal is to become a credit repair specialist and seek employment in an existing credit repair company, there are still some federal and state laws you have to understand. These are the laws that regulate how credit repair companies operate, and you have to comply with them, even though you just be an employee and not the owner of a business.
Most of them set the terms of how a certified credit repair specialist can advertise their services and prohibit them from misrepresenting their offerings to their clients. Consumers are protected by law, so credit repair agencies are not allowed to make false promises and must use special disclosures when conducting their business.
Here is a breakdown of the most important credit repair laws you have to abide by.
Fair Credit Reporting Act (FCRA)
The FCRA is a federal law that regulates how consumer information can be collected and shared by credit reporting agencies. It promotes accuracy in credit reports and mandates that consumer information be kept private and protected from unnecessary exposure.
While its main purpose is to set limitations to background screening companies, credit repair specialists should be familiar with it as well. Some of its most important stipulations include:
- Consumers have the right to dispute the information in credit reports, and credit bureaus must investigate if the disputed information is correct.
- Only persons with a reasonable and legally permissible purpose can request to see the credit report of another consumer.
- If an employer, creditor, or any other institution decides to take adverse action against a consumer based on information they got from a credit report, they must let them know.
Credit Repair Organizations Act (CROA)
Like the FCRA, the CROA is also a federal law, though this one regulates credit repair companies specifically. The CROA focuses on how credit repair companies present their services to consumers and aims to prevent them from deceiving potential clients.
The CROA stipulates that:
- Credit repair companies must outline their services in a written contract which must be signed by the client.
- Credit repair companies are prohibited from asking their clients to pay in advance. For this reason, most companies analyze the credit report of their potential clients and offer a free consultation, before they charge them a fee to repair their credit.
- Consumers have the right to cancel their contracts with credit repair agencies under specific circumstances.
Companies that violate the CROA can be penalized, fined, and even shut down by the US Federal Trade Commission.
Credit Repair State Laws
The federal laws serve as the main guideline for credit repair state laws. Each US state has its own laws regulating credit repair companies, and in some states, the state laws might even be stricter than the federal laws. In such cases, they supersede federal laws, which is why you must have a sound understanding of your own state’s law to be a credit repair specialist.
As an employee, it is your responsibility to comply with the credit repair laws. If you find yourself working for a company that doesn’t, it is in your best interest to seek employment elsewhere. Breaking the law will not only get you in legal trouble, but also leave a stain on your reputation as a credit repair specialist, and make it incredibly difficult for you to have a successful credit repair business in the future.
The Bottom Line
Even though, in theory, all consumers can repair their credit on their own, most consumers simply are not interested in learning how to do it. They don’t have the time or patience to thoroughly go over their reports, dispute errors, and find details they can improve on.
Most people would much rather hire someone else. This is why getting a credit repair specialist certification and becoming a credit repair specialist is a good idea, especially if you are already familiar with the basics.
FAQs
What does a credit repair specialist do?
Credit repair specialists improve their clients’ credits by ensuring their credit reports are as accurate as possible. They contact the credit bureaus on behalf of their clients and dispute the inaccurate information dragging down their credit scores.
How much do credit repair specialists make?
According to the latest statistics, the average annual salary of credit repair specialists is $46,040, or $22 per hour. The majority of credit repair specialists in the US make between $31,000 and $55,000 per year, while the highest earners earn $80,000.
What skills do you need to be a credit repair specialist?
In addition to a deep knowledge of the credit repair processes and relevant laws, a business or finance degree with courses in consumer credit, accounting, and economics would be ideal for a credit repair specialist. Moreover, strong communication and negotiation skills can go a long way in this field.
