How to Open a Credit Repair Company
Company registration
Credit repair software
Office equipment
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Things You'll Need
- By 2007, Americans owed $16 trillion to creditors in personal and home loans. About 80 million Americans are currently struggling to keep up with their monthly payments, resulting in a bad credit score. Credit is borrowing money against a projected income in order to maintain a certain lifestyle. The credit repair business has grown as more and more people seek to restore their credit worthiness.
Instructions
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Register your company first with the state attorney general's office before doing any business. Each state has its own laws. If you are registering your company in California, for instance, the state law requires that you obtain a $100,000 surety bond with the Secretary of State and maintain it throughout the years you are in business and two years after. Understand the Credit Repair Organizations Act to make sure you are operating within the law. Write a complete description of the services you will be offering as required by the federal laws.
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Look for money to start your business. You will need it to pay immediate expenses, such as bill payments, rentals and payroll. Find a location to base your business. Secure office equipment, such as computers, broadband internet, telephones and furniture. Seek quality employees to hire and train.
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Clients are essential to succeed in this kind of business, so effective marketing is key. Advertise your company in local and state business directories. If you have enough money, you can even advertise on local television channels and radio stations. Avoid claims that might mislead customers about what you can do for them. That is a common mistake that a host of credit repair companies make. The success of your business hinges on ethical behavior.
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Attend credit repair training or workshops to learn more on sales, marketing, client support and other skills you and your staff will need. There are various organizations that offer this kind of training. Join associations in the industry, such as the National Association of Credit Services Organizations. Apart from the training they provide, you will network and learn a lot from others in the industry. As your business grows, continue training to build your skills and take your company to a higher level.
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Establish a good working relationship with the credit reporting agencies, namely Experian, Equifax and TransUnion. A good working relationship will help your business succeed. Know who to contact in order to resolve problems on behalf of your clients. Your business is helping to remove negative information on your client's credit history, which means dealing with the credit agencies regularly.
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Tips & Warnings
Once your company is up and running, avoid common industry mistakes, such as poor client support and making them feel that the only thing you are after is their money. Also advise your clients of their rights. Promising results in advance is a false claim, and it is against the law. Instead inform your clients about what you have been able to achieve for your other clients.
Do not fall into the trap of breaking the law in order to achieve results for your clients. Integrity is key to your success.
References
Resources
- Photo Credit money and bolts image by Petr Gnuskin from Fotolia.com
