2016 Saw a Reduction In Credit Repair Complaints
by Michelle Black, CreditWriter.com
In every town, city, and state across this nation there are consumers in desperate need of ethical and compliant credit repair services. Credit reporting errors occur often and these problems can make life extremely difficult for consumers. According to the Federal Trade Commission’s study of credit report accuracy there could be as many as 40 million (or more) mistakes present on the credit reports of American consumers. These types of credit problems can often make it impossible for families, single parents, small business owners, and a host of other consumers to achieve their dreams.
As a member of the credit repair industry, and especially as a member of the National Association of Credit Services Organizations (NACSO), these previous statements likely resonate with you strongly. A desire to help others overcome their credit problems is probably one of the primary reasons why you entered into the credit repair arena in the first place.
Of course, not everyone who advertises credit repair services is so altruistic, or even honest. It is no secret that the credit repair industry has some bad apples, just like any other industry. Thankfully NACSO remains hard at work to expose and push out scammers in an effort to both protect consumers and also to help reputable and complaint credit repair companies thrive. With so many consumers in desperate need of ethical credit repair services, NACSO’s efforts on the industry’s behalf remain more important than ever.
A Reduction in Consumer Complaints
The Federal Trade Commission (FTC), in cooperation with a number of other law enforcement agencies, releases an annual report on consumer complaints known as The Consumer Sentinel Network (CSN) Data Book. This report makes available to the public the annual complaints made by consumers to a number of agencies including the aforementioned FTC, the BBB, the FBI, the DOD, and the National Association of Attorneys General, among many others. The report includes consumer complaints about many issues such as identity theft, telemarketing scams, advance-fee loans, debt collection, credit reporting issues, and credit repair – just to name a few.
Here is a look at the number of consumer complaints against “credit repair” companies as reported in the CSN Data Book for the year 2016. Out of over 3 million consumer complaints received in 2016 there were only 1,551 complaints (a mere 0.05%) made against credit repair companies. That number is down when compared with both the 1,897 complaints received in 2015 and the 2,272 complaints received in 2014.
By contrast there were 859,090 complaints about debt collection and 399,225 complaints about identity theft. Credit counseling, an industry which is primarily comprised of non-profit companies and one which is not nearly as vilified by federal and state watchdog agencies as the credit repair industry, actually received over 3 times as many complaints as credit repair (5,596) last year. Even diet products/centers received more than 4 times the amount of consumer complaints (7,766 to be exact) when compared with those filed against credit services organizations (CSOs).
The number of legitimate credit repair companies has continued to rise in recent years. This is great news for the large number of consumers who are in desperate need of credible credit repair services. Yet despite the rise in number of new legitimate credit repair businesses, as mentioned earlier the number of consumer complaints against credit repair companies actually declined in 2016. This reduction in complaints is believed to be largely due to the efforts of the credit repair industry to regulate itself via its trade association NACSO.
The credit repair industry still faces a lot of hurdles, which is why it is essential for reputable credit repair companies to band together under the NACSO banner in an effort to protect and clean up the industry even further. Yet despite the hurdles, CSOs can certainly count this reduction in complaints as a win and, more importantly, a challenge to continue to work hard to provide even better services for consumers in the years to come.