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Credit Repair Business Idea

With millions of Americans in debt, now is the perfect time to learn how to start a credit repair business. A credit repair business helps people who have bad credit re-establish a better standing.

As a home based business idea, this is great for someone who wants to improve a client’s financial health.

What is Credit?

When you pay bills or loans, a record is kept by a credit bureau organization. Likewise, if you are sued or declare bankruptcy, these details are maintained by one of the three major credit bureaus, Equifax, TransUnion and Experian.

These bureaus create a report upon request, and assign you a credit score based on your payment history. The higher the score, the better a risk you are for repaying a bill or loan.

So, if you want to buy a new house or car, or turn on utilities, or even open a new credit card, the builder, car company, utility company or store will run a credit check by contacting a credit bureau. If you credit is good, you’ll get accepted, but if it isn’t, you may be denied the house, car, et cetera.

What Does a Credit Repair Business Do?

A credit repair business helps people with bad credit by contacting the credit bureau and requesting more information about the negative items on the report. The client may then determine if any are inaccurate. When that happens, the credit repair business will write to the credit bureau disputing that item in the report.

Credit bureaus have 30 days to respond, and if they cannot prove the claim, it is taken off of the report. As a result, the credit score usually improves.

In addition to repairing bad credit, consolidation of debt is another area some repair agencies may offer. Credit counseling is another way to help people manage their debt.

Learn How To Start a Credit Repair Business?

The equipment you’ll need will be fairly basic; a computer with Internet access and a phone are essential. You’ll be contacting credit bureaus during business hours, so you’ll need to be accessible during standard the day.

You’ll also need to have a firm understanding of consumer rights and the Federal Trade Commission’s ( guidelines on fair reporting acts for businesses.

In some states, licensing or bonding may be required.

Excellent written and verbal communication, good organization, detail orientation and diligence are necessary to be successful in this field.

Integrity is an important trait in a credit repair business. Because there are many unreliable companies, honesty and trustworthiness will be the most important services you can give you client. These points cannot be stressed enough when learning how to start a credit repair business.

Getting The Word Out

A number of businesses offer kits to get you started, but beware: the credit repair business is known for having many business scams. Establishing your credibility is important. Advertise in local free newspapers, offer a debt-reduction seminar at a community college, or contact your chamber of commerce to be included in upcoming business seminars. Word of mouth will be the best advertising.

Helping people repair their credit and move past financial mistakes is a rewarding business opportunity.

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