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How to Start a Credit Repair Business

in

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Cost of starting a credit repair business

Roughly $200

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Bond Requirement

$0 - A bond is not required in this state

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Potential average profit

$20,000 monthly

Credit Repair Laws in Alabama

The state of Alabama does not post any documents about operation of Credit Repair organizations. It is likely that they defer to the Federal Credit Repair Organization Act, as shown below.

Federal Laws

The Credit Repair Organizations Act (CROA) is a federal law passed in September 1996 that regulates organizations whose purpose is increasing consumer’s credit score through credit repair. One of the most important things the CROA did is make it illegal for credit repair organizations to make false claims. Don’t worry though, staying compliant is pretty easy after you get familiar with the law! This law is moderated and enforced by the Federal Trade Commission (FTC), so the FTC has the authority to close down any credit repair organizations that are operating outside the parameters of these laws (like fraudulent or illegal activities).

The main sections include mandates that:

  • You can’t misrepresent your services (no false claims about what you will do for the client and definitely no promise of working and then not doing the work).
  • You must provide a written contract between you and the client that the client signs.
  • Your clients have three days to cancel the contract.
  • You can’t charge until services are rendered (most companies will do some initial document processing and then charge the client for the work they have just done).
  • Consumers can sue and get refunded all money paid (plus legal fees and damages)  if the credit repair organization is found to have violated the CROA with that consumer.
  • State laws can’t change or render any of the CROA ineffective.

Simply put, these laws were put in place to protect people from credit repair companies using scammy business practices. As long as you’re not trying to be sketchy and scam people, you should be able to stay compliant easily!

To read the Credit Repair Organizations Act in full, visit the United States House of Representatives’ record of the act here.

The Credit Repair Organizations Act (CROA)

15 USC CHAPTER 41, SUBCHAPTER II-A: CREDIT REPAIR ORGANIZATIONS

For additional information about starting a credit repair company in [STATE] contact your state or an attorney.

Requirements for Surety Bond for Credit Repair Business in Alabama

A BOND IS NOT REQUIRED IN ALABAMA.

Statute of Limitation on Debt in Alabama

Alabama credit repair businesses must be knowledgeable about the statute of limitation governing debt in Alabama because this will guide your business decisions and enable you to best help your clients. The statue of limitations essentially limits the time that a creditor can legally sue a consumer for payments for a debt. Statutes of Limitation (SOL) do vary by state and debt type. In general, it is usually between 3 to 6 years, but sometimes longer.

To learn more about the statute of limitation laws for your state, click here.

Alabama Credit Repair License

We’re not aware of a state requirement for a “credit repair license” to operate a credit repair business in Alabama. However, many find getting training and a certification useful because it:

  • Conveys competence to prospective clients
  • Helps gain the trust of clients
  • Arms you with the training and tools you need to help clients and build a recurring revenue model

The American Credit Repair Academy http://try.creditrepaircloud.com/academy/; offers training, resources, and credit repair certification

Market Potential for a Alabama Credit Repair Business

Market Temperature:

0 1 2 3 4 5 6 7 8 9 10
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Percentage Of Credit Reports That Have Errors

79%

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Total Number of People Living In Alabama

4.86 Million

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Average Debt on Credit Report

$5,700

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Percent of Population With Credit Scores Below 700

44.3%

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Percent of home buyers getting a mortgage for their home purchase

88%

How to Profit with a Credit Repair Business in Alabama

1. Start

  • Get a powerful CRM that handles your business for you
  • Train and learn about the business
  • Create a professional website
  • Market your business to new clients

2. Run

Use software to automate the tasks of a credit repair business in Alabama:

  • Import clients’ credit reports
  • Generate dispute letters in seconds
  • Manage recurring payments and affiliate programs

3. Grow

  • Capture new lead and close more deals
  • Use the data you gather to scale your business
  • Automate more functions: signature capture, payment integrations, meeting scheduling, and more

All of this is available with Credit Repair Cloud

TRY IT FREE!

Frequently asked questions

How do I know if my credit repair business name is available in Alabama?
If you have a credit repair company name all ready for business registration in Alabama, you should first look to see that it is available in the Alabama Business Entity Database. If the name is not available you may still be able to use it as your DBA as long as you ensure you are not infringing on any trademark or other rights of the registered business. Consult with a lawyer and/or an accountant if you’re not sure, or choose an available entity name for your credit repair company and reserve the name with the Alabama Secretary of State.
What are the steps to become an official Alabama credit repair company?
Most credit repair companies in Alabama need to register for with the Alabama Department of Revenue for a tax ID. You will need a Federal Employer Identification Number (FEIN) to register your credit repair company with the state of Alabama. Although you may not need an EIN to run your business as a sole proprietor, it is not a bad idea as using an EIN can protect your personal information. Consult with a CPA and/or attorney to see determine the best option for your credit repair company.
Why should I start my credit repair company in Alabama?

If you plan to operate your company in Alabama, it is much easier (and usually less expensive) to register as a domestic entity in the state. You will also have the benefit of business information pages from the Alabama Secretary of State and an interactive and rich service in the Atlas Alabama website, including training events, links to business resources, and more.

What Other Credit Repair Businesses Say

ROB Y

Laredo, TX

We have a tax preparation business. My partner and I decided to branch out into credit repair. Credit Repair Cloud now helps us to build our customer base for the tax business. It is a wonderful tool for lead generation. Credit-Aid provides superior customer service. You have gained a customer for life!
testimonials-bob.jpg

MANAL MASSIS

Houston, TX

I love your system! This was the best investment ever and the customer service with Credit Repair Cloud is excellent. You have a very good team. I wish companies were just like you. I've tried everybody out there and your system is very powerful. Thank you for helping me. God bless you!
MANAL MASSIS

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How to Quickly Start a Profitable Credit Repair Business

MINUTESSECONDS
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Secret 1

How Credit Repair is the LOWEST COST & MOST PROFITABLE business you can launch. . .

Secret 2

How our step-by-step “Dispute Process Blueprint” gives you EASY Credit Repair Results without being a credit expert. . .

Secret 3

How our easy method gets you UNLIMITED Clients without paying for advertising. . .

Legal disclaimer: Our software products and resources offer credit information, not legal advice. We make every effort to ensure the accuracy of the information and to clearly explain your options. However, we do not provide legal advice (i.e.; the application of the law to your individual circumstances). For legal advice, please consult an attorney, your city or your state.