Credit Repair Laws in Tennessee

If you’re planning to start a credit repair business in Tennessee, learning about the state’s Credit Repair Laws is crucial.

But before delving into that, let’s take a moment to examine the landscape of credit health in the state to grasp the potential opportunities for your business.

Is It Good to Build a Credit Repair Business in Tennessee?

Tennessee is among the American states with an impressive economic track record. With a population of 6,829,180 as of June 2020, the state’s poverty rate remains low at 15.2%, lower than the national average of 16.1%. Moreover, according to the Experian National Credit Score Index 2022, the average credit score in Tennessee stands at 702. This is much higher than Texa’s 693, Louisiana’s 689, and New Mexico’s 699.

In terms of debt, the average person in Tennessee has an estimated mortgage debt of $184,360 and an average credit card debt of $5,688. Moreover, Tennesseans have an average auto loan debt of around $17,579. And average student loan debts of $36,418 as of 2023.

Credit Repair Laws in Tennessee: Protecting The Consumers

What Are the Prohibited Acts Under Tennessee Credit Repair Laws

The state of Tennessee, like most other states, has laws in place to protect consumers from fraudulent activities of credit repair services. The prohibited acts put forth by the state include:

• Requiring an advance or charge for any services before they are fully rendered
• Furnishing a document or application with false or misleading information
• Misrepresenting services or potential results, and
• Advertising or using any devices that misrepresent the identity, business, or services of a credit service organization.

Required Surety Bond for Credit Repair Businesses in Tennessee

Moreover, the law states that all credit repair services should obtain a surety bond of 100,000 USD before offering their services to the public.

What Should the Contract Contain When Providing Credit Repair Services in the State?

Furthermore, the law also states that all credit service business should disclose written contracts with all the important details of the service provided. Such as: Estimated amount of the services, estimated date to complete, business name and address of the credit repair service provider, and name of the representative.

Moreover, a notice of cancellation should also be attached to the contract. With the information that clients are allowed to cancel the contract within 3 business days after the date signed.

Credit Repair Laws Tennessee Vs. Other States

It is important to note that the credit repair laws in Tennessee differ from those in other states like California and New York. In California, credit repair services are typically required to draft contracts in Spanish. Whereas New York has a provision that permits the commissioner to act upon a breach of contract.

Furthermore, some states, like Florida, have additional laws governing credit repair services. Such as providing for actual damages for people in instances of a breach of contract and stricter regulations.

Overall, Tennessee has some of the country’s most consumer-friendly credit repair laws. Hence, it allows consumers to control their credit and guard against fraud.

** Disclaimer: We aim to provide the most accurate information regarding credit repair laws in Tennessee. However, please note that the laws may change anytime. Therefore, we recommend researching for further information or consulting a lawyer about credit repair services law.

If you are just starting a credit repair business, we have a comprehensive guide on how to start a credit repair business.

Read Credit Repair Laws in All States or navigate the map to read credit repair laws in other states.