A recent post by Richard Smith brought forth thought provoking questions regarding the the validity and ethics of the newest generation of CREDIT REPAIR attorneys. Smith asks when credit repair crosses the line of ethics, and becomes the falsification of a credit report.
I prefer to take another angle on the subject. For years creditors have been able to label a consumer a “credit criminal” without the due process that is afforded to people being accused of crimes. While the American way has always been one of a “presumption of innocence” this is not only not the case with credit reporting, but often times credit problems can become a complete and utter nightmare for a consumer.
Today, more than ever, credit matters. Not only for the extension of credit, but for obtaining insurance, and employment as well. Insurers are using a consumers inability to pay a medical bill as a reason to charge more for insuring their home or automobile as if this raises the likelihood of an accident or fire. Does this make sense?
There are many rules regarding the reporting of derogatory credit items that creditors simply do not properly adhere to. The function of the credit repair attorney is to UNCOVER those rules not adhered to, and when a creditor has not followed the correct steps, force the creditor to remove the derogatory information. IS THIS LEGAL? MORE IMPORTANTLY IS IT ETHICAL?
My sincere belief is ABSOLUTELY. While we all find it reprehensible when a criminal is set free on a technicality, most of us understand that those few and far between cases make the overall criminal process in America one that is the best in the world. It forces prosecutors and police to follow a set of rules that takes into account the rights of the accused. This system ensures we as citizens do not fall prey to an overzealous or oppressive government.
The same can hold true with regard to credit reporting. For years the credit industry has gone unchecked when reporting derogatory information regarding a consumer. Because this type of practice is relatively new, there will be times when legitimately reported adverse credit information ends up deleted. Is this fair? Perhaps not, but some consumers actually DESERVE a second chance. For example, there are people who had an isolated period of instability which caused credit problems.
Some people will go on after credit repair to establish a positive pattern of credit habits, and probably contribute more to our economy than they would have if hampered by poor credit.
Others will have not learned their lesson and will go and ruin their credit again. These people will not benefit much from credit repair firms in the long run.
Perhaps there will be cases where after credit repair, a consumer obtains new credit, only to default immediately. These are added risks to creditors, but in the overall scheme of things, the risk is still relatively low. I think we should give people the benefit of the doubt. People who are willing to invest the time and money into repairing their credit are probably more likely the continue to work hard to preserve their newly acquired credit rating. The last thing we need is to have the creditors lobby the government that we need some sort of new regulation on this matter.
Ralph D. Nudi
Weichert, Realtors Unum Properties
Ralph is a co-owner of Weichert, Realtors – Unum Properties in Kenosha, WI. Ralph is an expert in Kenosha Real Estate market. In addition to publishing articles on the Kenosha Housing Market and Kenosha landmarks and interesting articles regarding Kenosha Homes, Ralph is also a leading REO agent in Kenosha County and has specialized in pre-foreclosure and short sale homes for several years, closing over 100 short sale transaction in the last 24 months.
Ralph D. Nudi