Consumer Protection Division
Credit Service Organizations
Promises to improve poor credit can be deceiving
Advertisements often promise miracles in repairing bad credit reports. Credit service organizations tell consumers that for a fee, bad credit, judgments, bankruptcies, and bad debts can be erased from credit reports forever, or that a new credit identity can be created that will solve all the consumer’s credit problems. In reality, such ads promise things that cannot be delivered.
What Indiana Law Requires of For-Profit Credit Service Organizations
- Have a written contract with consumers describing in detail the services to be performed.
- Provide consumers with a three-day right to cancel the contract.
- Maintain a $25,000 bond to be used to satisfy consumer claims.
- Negative but accurate credit information cannot legally be removed from a credit history except by the passage of time.
- No one can guarantee to erase bad credit.
- You can remove inaccurate or outdated information from your credit report yourself, at no cost.
- It is illegal to allow a credit service organization to set up a new credit file for you.
- Do not pay credit service fees before the services are completed.
- Indiana law gives you the right to sue credit service organizations for the greater of twice your actual damages or $1,000 plus attorney fees.