ESCRA Act

The ESCRA Act would amend federal law governing credit repair organizations to combat fraudulent practices in the industry. The bill would prohibit credit repair companies from charging consumers until they provide documented proof of credit improvement at least six months after providing services. It would also require all credit repair organizations to obtain state licenses starting January 1, 2026, and would restrict their ability to submit multiple disputes about the same information to credit reporting agencies.

Additionally, the bill would strengthen consumer protections by requiring credit repair organizations to provide enhanced disclosures, maintain detailed records of communications for five years, and provide consumers with copies of all communications sent on their behalf. The bill would increase civil penalties for violations and prohibit knowingly making false statements to consumer protection agencies. If enacted, these provisions would make it harder for deceptive credit repair companies to collect upfront fees and would give consumers more tools to seek redress if wronged by bad actors in the industry.