CREDIT REPAIR LAWS IN ARKANSAS

Are you planning to start a credit repair business in Arkansas, USA? One of the most important things you must consider is learning about credit laws in Arkansas.

There are many controversies around the credit repair business, as many frauds have used this industry to collect money from people without delivering results. That is why the country has published a law specifically for credit repair to protect consumers from malicious and fraudulent acts. In addition to the general credit laws, some states have their own credit laws to provide more protection to their consumers. Thus, it is important to learn about the rules and regulations of the state when building a credit repair business. In this case, let’s discussed specifically credit repair laws in Arkansas.

Arkansas follows the general federal laws stated in the Credit Repair Organizations Act (CROA), which governs the credit repair companies of the state. Here is a summary of credit repair laws in Arkansas.

Prohibited Acts Under Credit Repair Laws in Arkansas

Under the state of Arkansas, no credit repair companies, agents, representatives, or person may do the following:

Receive money or any valuable consideration before the completeness of the services agreed to be performed unless the company or the service provider has obtained a surety bond from the state.

Receive any form of payment solely for referral of the client to a vendor who will extend credit to the client if the credit that will be extended is the same terms as those available to the general public.

Advise a client to make untrue or misleading statements about the creditworthiness or standing of the client to creditors or credit reporting agencies.

Make untrue or misleading representations of the services offered to deceit current or future clients.

Provide credit repair services without informing the client about “Consumer Credit File Rights Under State and Federal Law.”

Provide credit repair services without a written contract.

Information Statement Requirement

Arkansas credit repair laws require credit repair companies, agents, or specialists to provide a document about “Consumer Credit File Rights Under State and Federal Law” that is separate from the written contract of the consumer and service provider.

The statement should be the following:

“Consumer Credit File Rights Under State and Federal Law

“You have a right to dispute inaccurate information in your credit report by contacting the credit bureau directly. However, neither you nor any ‘credit repair’ company or credit repair organization has the right to have accurate, current, and verifiable information removed from your credit report. The credit bureau must remove accurate, negative information from your report only if it is over 7 years old. Bankruptcy information can be reported for 10 years.

“You have a right to obtain a copy of your credit report from a credit bureau. You may be charged a reasonable fee. There is no fee, however, if you have been turned down for credit, employment, insurance, or a rental dwelling because of information in your credit report within the preceding 60 days. The credit bureau must provide someone to help you interpret the information in your credit file. You are entitled to receive a free copy of your credit report if you are unemployed and intend to apply for employment in the next 60 days, if you are a recipient of public welfare assistance, or if you have reason to believe that there is inaccurate information in your credit report due to fraud.

“You have a right to sue a credit repair organization that violates the Credit Repair Organization Act. This law prohibits deceptive practices by credit repair organizations.

“You have the right to cancel your contract with any credit repair organization for any reason within 3 business days from the date you signed it.

“Credit bureaus are required to follow reasonable procedures to ensure that the information they report is accurate. However, mistakes may occur.

“You may, on your own, notify a credit bureau in writing that you dispute the accuracy of information in your credit file. The credit bureau must then reinvestigate and modify or remove inaccurate or incomplete information. The credit bureau may not charge any fee for this service. Any pertinent information and copies of all documents you have concerning an error should be given to the credit bureau.

“If the credit bureau’s reinvestigation does not resolve the dispute to your satisfaction, you may send a brief statement to the credit bureau, to be kept in your file, explaining why you think the record is inaccurate. The credit bureau must include a summary of your statement about disputed information with any report it issues about you.

“The Federal Trade Commission regulates credit bureaus and credit repair organizations. For more information contact:

“The Public Reference Branch

“Federal Trade Commission

“Washington, D.C. 20580”.

By signing below, you hereby acknowledge receipt of this statement before any contract or agreement between you and the company is executed.

DO NOT SIGN THIS INFORMATION STATEMENT UNTIL YOU HAVE READ BOTH SIDES

Your Signature ______________________________ Date____________

A copy of this statement signed by the client should be keep for 2 years by the credit repair company after the signed date.

contract

Contract Requirement under Arkansas Credit Laws

Credit repair services should only be provided to a client with a written contract dated and signed by the client with the following information.

A complete and detailed description of the services to be performed. This should include the guarantees and all promises of refunds if the services are not delivered and the estimated date and length of time for the services to be complete.

The terms and conditions of the fees include all payments made by the clients to the credit repair company or a third party in connection with the services performed.

Business name, address, and agent’s name and address authorized to receive service of process.

A statement “You, the buyer, may cancel this contract at any time before midnight of the fifth day after the date of the transaction. See the attached notice of cancellation form for an explanation of this right,” which should be in boldface type and placed in immediate proximity o the space reserved for the client’s signature.

“Notice of Cancellation” should be attached to the contract in boldface.

“Notice of Cancellation”

“You may cancel this contract, without any penalty or obligation, at any time before midnight of the 3rd day, which begins after the date the contract is signed by you.

“To cancel this contract, mail or deliver a signed, dated copy of this cancellation notice, or any other written notice to [ name of credit repair organization ] at [ address of credit repair organization ] before midnight on [ date ].

“I hereby cancel this transaction,

Purchaser’s Signature ______________________________ Date____________

** Disclaimer: We aim to provide the most accurate information regarding Arkansas’ credit repair laws under Arkansas Statute. However, please note that the laws may change anytime. Therefore, we recommend doing more research for further information or consulting a lawyer concerning credit repair services law.

FAQ (Frequently Asked Questions)

What are the registration requirements when starting a credit repair business in Arkansas?

There is no license required for credit repair companies in Arkansas. However, you may have to register your business for taxes.

Is a surety bond required when doing credit repair business in Arkansas?

Yes. Arkansas requires companies, agencies, and professionals to obtain a surety bond to protect people who do business with them.

What is the required surety bond for a credit repair business in Arkansas?

A credit repair company should obtain a $10,000 surety bond to operate in the state.

Aside from learning credit repair laws, another key factor to consider when starting a credit restoration business is getting reliable software for a credit repair business. It is best to get a program that has all the tools you need to run the business, just like this all-in-one credit fix software for businesses that helps fix credit fast and has CRM, Sales, and Marketing program integration to assist you in growing your business fast.

Want to learn more about how to start a credit repair business? Read this simple guide on how to start your credit repair company.

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