As a credit consultant, it important to understand the best approach when using a power of attorney. A power of attorney grants you’re the ability to act in behalf of your client as if you are them. If you contact a creditor or credit bureau stating that you have a power of attorney they will accept it and cooperate with that document.

HOWEVER, and this is a huge however, unless you are an attorney that represents a clients, many of those who states to a lender or CRA that they have a power of attorney often gets poor results. If a CRA knows that you are a credit repair company, it can cause all types of problems with your clients. We have seen clients having to actually obtain a lawyer to get control over their credit file again. Why? Well, it is true that you have rights but so do credit bureaus if they feel you are attempt to scam them. They will  often take credit repair companies through tons of stalls using all types of frivolous claims when they have used this approach. Their clients often ends up not getting the results they desire and become angry.

A better way is to obtain a power of attorney but act as if you are the client if you are speaking with these organizations or negotiating in their behalf.  Instead of sharing that you have the power of attorney and providing your name as a company working on behalf of a client.

This maybe a gray area but it works much better in most cases.

This KEY POINT is for them to NOT know that you are a credit repair firm period.

Of critical concern here, FACTA also states that furnishers’ statutory duties “ shall not apply if the Notice is submitted by, is prepared on behalf of the consumer by, or is submitted on a form supplied to the consumer by, a credit repair organization as defined in section 403(3) or an entity what would be a credit repair organization, but for section 403(3)(B)(i)” (emphasis added). Section 403(3) is a part of CROA and defines a CRO in pertinent part as: