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Special Reports
Credit Restoration
Credit Consultants Helps Counter Tighter Guidelines
'Clients must be realistic.'
By Alton Gary Simpson
Credit Consultants USA Inc. here, a fee-for-service corporation specializing in
credit consulting and restoring credit, helps consumers restore their credit by removing inaccurate or unverifiable
information from their credit reports. In addition, the company has inquiries removed from credit reports. "We're
service-oriented, broker friendly and our reputation in the industry is impeccable, as is our reputation with the
public," said Hedy Berman, national sales director, Credit Consultants USA. "A day doesn't go by that
we don't receive a call from a mortgage broker who was referred by another broker."
More than 4,000 clients have been helped since Credit Consultants USA opened in 2003, she said, and added that
approximately 70% of Credit Consultant USA's clients come from mortgage broker referrals. The rest are from client
referrals or are repeat customers.
Ms. Berman said that compared to last year at this time, Credit Consultants USA has seen at least a 25% increase
in business. "More and more mortgage brokers are contacting us to assist them with their clients," she
said.
A lack of home price appreciation and tighter underwriting and credit guidelines resulting from the meltdown in
the subprime sector are forcing mortgage brokers and real estate agents to be more creative about helping their
clients qualify for mortgages, thus driving more business to credit restoration services like Credit Consultants
USA. She said that on average, Credit Consultants USA is able to help a consumer raise their credit score by 50-100
points. According to Ms. Berman, the average score improvement for the credit restoration industry is about 50
points.
Ms. Berman explained how the credit restoration works. Creditors may report misleading or inaccurate information
on a credit file. However, under the Fair Credit Reporting Act, consumers have the right to question the reporting
information. If the creditor cannot verify the information within 30 days, it must be removed.
There are three major credit bureaus that lenders use - Equifax, Experian and TransUnion. Although mortgage brokers
obtain trimerged credit reports containing information from all three bureaus, they are separate entities and do
not share information. Credit Consultants USA purchases and evaluates credit reports from all three bureaus without
generating any inquiries (too many separate credit inquiries can lower a credit score). After obtaining and evaluating
the credit reports, the company provides a full consultation and credit evaluation, including tips on how to boost
the credit score and a full dispute process. "We are on the same team as the mortgage broker and the client,"
said Ms. Berman. "We can do the most line items in the shortest amount of time and get the client back to
the broker within two to three months. We're a friend to the broker."
She added that the firm also provides updates to brokers about the progress of the clients they referred. She also
said that Credit Consultants USA doesn't just help its clients improve their credit scores, but puts them on track
to keep improving their scores as the year progresses. "No client should walk out of their [mortgage broker's]
office without talking to us. We can make the final determination about whether we can help a client or not,"
said Ms. Berman, with the caveat, "Clients must be realistic." If a client has 60- and 90-day lates,
or has a foreclosure, those will be much more difficult and time-consuming to remove. She added that in the worst-case
scenario - where a client has a large debt with no way of paying it off - Credit Consultants USA will tell the
client that they may be a better candidate for bankruptcy protection than credit restoration.
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