2 Ways the Credit System is not Like the Legal System

By: Stuart Hunter

The first difference between the legal system and the credit system is that in the legal system you are innocent until proven guilty. In the credit system, the exact opposite is true.

In the credit system you are assumed to be guilty as soon as a creditor reports to the credit bureaus that you have been late on a payment or committed some other credit "crime". Once this has been reported, you immediately begin your punishment in the form of a decreased credit score. There is no investigation performed and there is no proof required. You are considered guilty the moment you are accused.

At this point the argument could be made that when disputing an item on your credit reports, you are forcing the credit bureau and the creditor to prove your guilt but even this isn't completely accurate. When performing an investigation, the credit bureaus are basically asking the creditor if the negative listing should remain on your credit reports or if it was reported incorrectly. Note that the creditor is not asked to "prove" that the listing is accurate and all they have to do to appease the credit bureaus is to state that there was no error. If this happens, the negative item remains and you are still being punished even though your transgression is still merely an unproven accusation by your creditor.

When an item is being reported inaccurately and confirmed by the reporting creditor (ie. the creditor's records are incorrect and this incorrect data is being used to confirm the negative listing), it is up to you to prove your innocence. Doing so may require a number of tactics available to you through various consumer protection statutes and will likely take a significant amount of time for you to understand and apply successfully.

At the end of the day, proving your own innocence could be a difficult and time intensive task that you are forced into performing simply because you were falsely accused. This is why so many people have elected to receive help from a reputable credit repair company like .

The second difference has to do with the classification of transgressions and the punishments handed out. For example, in the credit system, if you have your vehicle repossessed by a creditor, a repossession is recorded on your credit reports and you are punished in the same fashion as everyone else who has been accused of a repossession.

In the legal system however, we recognize that there are mitigating circumstances. For example, if your actions result in the death of another human being, you may be charged with murder, manslaughter, or homicide with numerous degrees of each. Because these distinctions are made, punishments can be assigned based on the nature of your actions.

If the legal system worked in the same way as the credit system, whether you caused someone's death by stalking and killing them, in a moment of rage, in an automobile accident, in self defense, or in the line of duty, you would be punished exactly the same as everyone else who was accused of causing someone's death.

It is in this inherent unfairness, the associated punishments, and relatively poor rights of the accused that causes so many people to have problems with the credit system. It is a system that has been largely molded by the credit bureaus and creditors. As opposed to the legal system that serves to protect the rights of the individual, the credit system serves to protect the profits of lenders.

Learning how to protect yourself as the underdog in the credit system is not easy task and because of this, the number of people receiving legal assistance from credit repair firms has continued to increase over the years. For many people, getting help from a has been the only way they have been able to get a fair shake from the credit system.

Credit Matters
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 
 • 

» More on Credit Matters