BEST CREDIT REPAIR
Credit Repair Warning
Ontario strengthens consumer protection
against CREDIT REPAIR companies
TORONTO - Changes to provide fuller protection for consumers who deal with credit repair companies came into force Feb. 11, 2002.
Norm Sterling, Minister of Consumer and Business Services announced changes to regulations under the Consumer Reporting Act requiring consumers to be fully informed of their rights when they enter into contracts with these companies.
"Consumers have paid credit repair companies up to $1,000 to have their credit rating fixed, only to find that either no changes were possible, the changes made to their files were minimal or they could have had them done on their own for free," said Sterling.
"Credit repair companies have already been forbidden to take any payment in advance of providing services, but these new regulations take consumer protection even further."
The new regulations require specific information to be spelled out in credit repair service contracts, including:
- A description of the services
- The price and terms for payment
- Statements setting out the consumer's right to dispute inaccurate information in consumer reporting agency files on their own, and
- Statements setting out the consumer's right to cancel the contract without reason during a five-day cooling-off period for any reason, under the Consumer Reporting Act.
Further, the regulations prohibit a credit repairer from stating, orally, in writing or through advertising , that it will improve a consumer credit file unless:
- The credit repairer has reviewed the consumer's credit
- Information on the file has been found to be inaccurate or incomplete, and
- The credit record would be materially improved by correcting the deficiencies
- in other words, finding minor errors would not constitute a "material improvement." A "material change" could include removing a negative item that belonged in someone else's file or removing a negative report from a consumer's file.
Accordingly, advertisements such as "we can help repair your bad credit" are prohibited unless the above conditions exist. Credit files are improved by working with creditors and improving payment habits over time. Consumers are encouraged to check their credit files every two years.
To find the credit reporting agency that holds your credit file, call the two major agencies toll-free from anywhere in Ontario.
(or editor's note: go online here for an inexpensive and immediate review of your credit report).
Consumers who have financial problems are advised to seek help from a member agency of the Ontario Association of Credit Counseling Services (OACCS).
At more than 20 locations across the province, the experienced staff of these not-for-profit agencies provide confidential services that have helped thousands of people conquer debt. For more information, contact OACCS toll free at 1-800-263-0260.
For more information on credit repair companies and many
other consumer issues, call the Ministry of Consumer and
Business Services at 416-326-8800 in Toronto or toll free at
1-800-889-9768, and visit the website at www.cbs.gov.on.ca.
© 2002 Canada NewsWire Ltd. All rights reserved.
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