I found something interesting when researching keyword phrases that people search for on the internet relating to the credit repair business. The term, ‘credit repair business software’, is the 5th most popular searched term. Yet terms like ‘credit repair business law’, ‘state regulations for credit repair business’, and ‘credit repair state laws’, come up with no search volume. Meaning virtually no one is searching for information about the laws governing the business they are considering starting. Yet there is a frenzy over what credit repair business software to use.

On the one hand, I’m not surprised. People call us every week after starting a credit repair business or attempting to. They have suddenly realized one of two challenges or both. Either they discovered that they need to obtain a surety bond to have a credit repair business in their state and weren’t told that by the credit repair business software company. Or, they realized that having credit repair business software now means they must conduct every aspect of their business by themselves which requires far more time and far more money than they had counted on.

Credit Repair Business Software May Not Be You’re Best Move

I am going to share with you why contracting with a credit repair business software company is, in most cases, the worst move you can make when starting a credit repair business. If you disagree after reading this, you can then visit an article I wrote on The Best Credit Repair Software.

You’re likely perplexed at this point because everything you’ve read and researched on the internet says you need credit repair business software to start a credit repair business. Then I come along and tell you just the opposite. I understand so let me share why I’m saying that.

Solopreneur vs Entrepreneur

If you are considering credit repair business software that means you will be doing the marketing for your business to get clients. You will be doing the selling of your services to those clients. You will have to find a professional way to pull their credit. By the way, most credit repair business software companies will have you tell your clients to open an account with another company like Identity IQ. Your clients will pay an added fee for this. Then give you their username and password so you can look at their credit report. Not very smooth and professional.

You’ll use your credit repair software to analyze that credit report and draft and send dispute letters to the credit bureaus. Then you’ll need to keep your client informed and be the customer service person for every client in your business. There’s more to it than that actually. I call a person that does this a Solopreneur. Not an Entrepreneur. You have a business, true. But you’re doing everything. What happens if you have another job or business? What happens when you want to take time off or get sick. Who’s taking care of your existing clients, doing the marketing, making sales, etc.?

What Are You Good At and Have Time For?

What I just shared with you is the number one reason why people fail in the credit repair business. There is a major factor in how much time you have to do all this. But there is also something else. Are you good at all this? Do you have the skillset for marketing, sales, admin, customer service, and more? I know that I don’t. Which is why I went in a different direction. More on that below.

Here’s something else. Let’s say you are good at all those skills. What are you offering to the market? Credit repair, right? Well, so do thousands of other people. What makes you different than those thousands of other solopreneurs and the big companies you’ll find on page one of Google? That’s right. You’re just another credit repair company. I have a solution for that as well that you’ll learn more about below.

Research Credit Repair Law in Your State First

Looking for credit repair business software should not be the first item on the agenda. You need to understand that credit repair business software companies like Credit Repair Cloud want to sell you their software. They don’t teach you how to get your business legally set up in your state. You’re on your own. We just had a woman join our company that had spent about $1,000 with Credit Repair Cloud only to discover that she couldn’t legally conduct business in her home state of Georgia.

The first thing you should do when contemplating starting a credit repair business is to research the laws in your state pertaining to being a credit repair business owner. There is a federal law called the Credit Restoration Organizations Act, true. But each state has its own set of laws regulating the credit repair business. And, you had better understand those laws or you will open yourself up for some significant liability.

Surety Bonds

Most states require you to have a surety bond to protect consumers in the event you don’t complete the services yet keep their money. Basically, it covers damages to consumers by mismanaged and underhanded credit repair companies. But this only allows you to do business in that state. What about the surrounding states or states across the country? It is very impractical and expensive to obtain surety bonds in many different states and certainly the entire country.

How Are You Going to Get Credit Reports?

If you get a surety bond if required by your state, you are not done yet. Not by a long shot. You still need to figure out how to pull credit or use the choppy method suggested by your credit repair business software company. The reason why pulling credit for your clients is an issue is that credit is pulled through credit report brokers. These are smaller companies contracted with the credit bureaus to provide businesses like mortgage companies, car dealerships, retailers, etc. with credit reports. In effect, these credit report brokers represent and have contracts with the credit bureaus. And, guess what? The credit bureaus don’t like credit repair companies and direct their brokers to not provide them with credit reports. Why? Because we make them do a ton of work (follow through on disputes) from which they generate zero revenue. The credit bureaus are in business to make money. We credit repair business owners cost them money. We are a huge expense and headache for them.

Getting Set Up to Take Credit and Debit Cards

But that’s not all. How are you going to take credit and debit cards? You’ll need a merchant services company to facilitate that. But first, you’ll need a merchant account at a bank. To get the merchant account you may need a business license. They will pull your credit, and ask for employment history, bank statements, and more. Then, if you get the account opened, they will either help you facilitate taking credit and debit cards or pass you on to a third merchant services provider.

It’s not over. According to SquaredUp.com, “Whether you end up working with the bank or, more likely, a third-party acquiring partner, you’re going to end up with a “bundled” solution. This means that your payment processing, hardware, and software may be sold as one big package but are actually all from different companies. Sure, it may work in theory, but products made by different companies don’t always work together seamlessly. It’s highly likely that you’ll need additional support to get all the systems working together. You have to pay for that out of pocket. Plus, keeping all those systems working together over the long haul can mean lots of expensive maintenance.”

If you get through all of this, bless you. But I will wager that you won’t. And, here’s why. Merchant Services companies don’t want to do business with credit repair companies either! Why? Because credit repair clients always, 100% of the time, cancel their accounts. And, quite often they’ll request a chargeback, so they get ALL their money back. That’s right. They call their bank or credit card company and tell them they never asked for the service or didn’t get the service they expected. They are the client of the bank or credit card company and their wish is granted. Merchant Services companies hate this. And, by the way, merchant services cost you a lot of money as a business owner.

Now Go Build a Website or Pay Someone To Do It

Ok, so now let’s say you have your credit repair business software. You’ve got your surety bond in your state. Doing business in other states is not a priority for you. You don’t mind asking your clients to open an account with some company and give you their login credentials to look at their credit reports. You somehow can take credit and debit cards. But what about a website? Social media accounts on Facebook, Instagram, YouTube, TikTok, and more.

Going through what I’m telling you about will take months and cost you thousands of dollars. And, then you’ll be doing all the work. Your business will own you instead of the other way around. Is that what you’re looking for? If so, visit The Best Credit Repair Software. I truly wish you the best of luck.

A Better Credit Repair Business Solution

However, if you want a better solution that will put you in business tomorrow then do what I did. Work with a company that has the entire infrastructure already set up. Websites, merchant services, and a customer service staff that does the dispute letters for you and takes care of your client after the sale.

You still need to do sales and marketing. That’s on you. But think of the time you’ll have available to do it. And, get this. You’ll be able to do business in all 50 states immediately without any surety bonds! You can be in the credit repair business immediately and it costs less than $300 to get started.

I know it sounds too good to be true. Especially if you’ve already gone pretty far down the path with a credit repair business software company. This is the business I have owned and operate full-time for the past 10+ years.

So, I have put a credit repair business video together for you to watch. It gives you all the details. If you like what you see after watching the video, then just below the video is a tab. Click it and you’ll be directed to our appointment calendar. Pick a day and time that works for you and we’ll get on the phone and talk.

No selling on our part. We're just here as a resource to answer your questions and see if our credit repair business model is a good fit for you. Please note that you must watch the video first. We're not going to do a presentation for you. That's what the video is for. We are going to have a business conversation with you, answer your questions, and help you determine if this is the right fit for you. I do look forward to talking with you.

This article which was originally posted in 2020 is updated regularly and was last updated in July 2023.