Cecily Zamora
Lexington Law is a credit repair service that helps people fix their credit by challenging inaccuracies on their credit reports. The company has been involved in legal troubles, including lawsuits served by the Consumer Financial Protection Bureau (CFPB) and Minnesota's Department of Commerce, for deceptive marketing practices and violating federal telemarketing laws. As a result of the lawsuits, Lexington Law has been ordered to pay consumer redress and civil penalties, and has been banned from telemarketing credit repair services for 10 years. Due to these legal troubles, it is unclear whether Lexington Law will be able to continue operating in the future. However, the company offers a free self-assessment to determine if their services are suitable for an individual, and customers can cancel their subscription by online chat at any time without penalty.
| Characteristics | Values |
|---|---|
| Can I cancel my credit repair service with Lexington Law? | Yes |
| How to cancel | Via online chat |
| Refund | No refund for unused days; additional charges may apply for work performed since the last payment |
| Email notification | Yes |
| Legal settlement | Yes, between CFPB and Lexington Law |
| Scam | Yes, there are scam companies claiming to help receive a check, money, gift card, or funds |
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What You'll Learn
Lexington Law's legal troubles
Lexington Law, one of the country's largest credit repair companies, has faced legal troubles in recent years. The company was accused of engaging in unfair practices and violating federal laws, leading to a lawsuit filed by the Consumer Financial Protection Bureau (CFPB).
The CFPB alleged that Lexington Law violated the Consumer Financial Protection Act of 2010 and the Telemarketing Sales Rule by illegally collecting upfront fees and engaging in deceptive advertising for their credit repair services. The court concluded that the company broke the law, and as a result, Lexington Law was ordered to pay $2.7 billion in consumer redress and civil penalties. The company was also banned from telemarketing credit repair services for 10 years.
The settlement of the case resulted in refunds for more than 4 million consumers who were harmed by the company's practices. The refunds are being distributed by JND Legal Administration, and eligible consumers can receive their compensation by verifying their eligibility and being vigilant against potential scams.
The legal troubles and bankruptcy filing have raised concerns about the reliability of Lexington Law's credit repair services. As a result, some individuals may choose to seek alternative options for credit repair or improvement.
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High fees
Lexington Law, a credit repair company, has been involved in legal action with the CFPB, which resulted in a $2.7 billion settlement. The company was found to have violated federal telemarketing laws by charging upfront fees illegally. As a result, Lexington Law has been banned from telemarketing credit repair services for 10 years and is required to pay refunds to affected customers.
Lexington Law's pricing structure includes a first work fee, which is charged 5-15 days after signing up for their service. This fee is separate from the monthly billing cycle and covers the cost of setting up an account, gathering credit information, and building a custom plan. The monthly bill for their services is charged 30 days after the first work fee. While the exact amount of the monthly fee is not publicly available, it is estimated to be $95.95 per month.
In addition to the monthly fee, Lexington Law also charges a $19.95 late fee for returned or dishonored payments. If you need to change a scheduled payment, a $9.95 fee will be incurred. It is important to note that you may also be charged a prorated fee for services already performed if you cancel partway through the month.
Compared to other credit repair companies, Lexington Law's pricing is considered relatively high. For example, Credit Saint offers a similar service package to Lexington Law for $109.99 per month, while The Credit Pros' Repair Credit plan costs $129 per month.
It is worth noting that Lexington Law does not require a contract, and you can cancel at any time to avoid being charged for the next month. However, the high fees associated with their services can be a significant financial burden, especially for those already facing credit challenges.
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Deceptive marketing practices
In 2019, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against Lexington Law, alleging deceptive and abusive telemarketing practices. The CFPB accused the company of illegally collecting upfront fees for telemarketed credit repair services and engaging in bait-and-switch advertising, which is a form of deceptive marketing.
The CFPB's lawsuit specifically targeted the company's marketing affiliates, who advertised products and services related to consumer credit. One of the most notable examples of deceptive marketing was the false advertisement of a "guaranteed 0-3.5% Down Home Loan" by one of Progrexion's marketing affiliates. This affiliate falsely claimed that anyone could obtain a loan, regardless of their credit score, if they signed up with Lexington Law. In reality, the affiliate did not provide any loans, and interested consumers were misled into believing that they had to sign up with Lexington Law to participate in the non-existent loan program.
The lawsuit also revealed that Lexington Law staff were aware of these deceptive practices. Emails exchanged among executives and management staff indicated that they knew about the deceptive nature of their affiliate's scripts and did nothing to stop them.
As a result of the CFPB's enforcement action, Lexington Law was ordered to pay $2.7 billion in consumer redress and civil penalties. The company was also banned from telemarketing credit repair services for ten years.
It is important to note that, while Lexington Law has faced legal consequences for its deceptive marketing practices, there are also scams associated with the distribution of refund checks to affected consumers. The CFPB has warned consumers to be vigilant and has provided resources to verify the legitimacy of any checks received.
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Telemarketing efforts demanding upfront payment
In a lawsuit filed by the CFPB, Lexington Law was found to have violated federal consumer protection laws by engaging in bait-and-switch advertising and illegally collecting upfront fees. As a result, the company was ordered to pay $2.7 billion in consumer redress and civil penalties and was banned from telemarketing credit repair services for 10 years.
Following this ruling, Lexington Law Firm has discontinued the ability to engage in their services by telephone. Sales representatives from the firm can no longer be contacted over the phone, and customers are directed to their online chat feature for support.
It is important to note that debt collectors are forbidden by law to threaten or pressure individuals into paying quickly over the phone. If you receive such calls, it is likely a scam, and you should refrain from providing any personal or financial information. Instead, you can take steps to block or ignore these calls, watch out for "spoofed" numbers, and only accept calls from known numbers.
If you believe you have been a victim of a scam, it is crucial to act quickly. Contact the three credit bureaus to freeze your credit, file a report with the Federal Trade Commission and IdentityTheft.gov, and notify your bank and credit card providers to take the necessary precautions to protect your financial information.
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Cancelling by online chat
Yes, you can cancel your Lexington Law credit repair subscription via online chat. However, it's important to note that you will not receive a refund for any unused days, and you may be charged for the work performed from your last payment until the cancellation date.
Lexington Law, one of the largest credit repair companies, has faced legal troubles due to deceptive marketing practices and violating federal telemarketing laws. As a result, they are banned from telemarketing their credit repair services for ten years, and customers have received emails informing them of their right to cancel without penalty.
Lexington Law offers a free self-assessment to determine if their services are suitable for you. Their credit repair services range from $99.95 to $139.95 per month, billed after the service is rendered. They also provide a free online credit assessment and a free credit report consultation.
While credit repair can be a challenging and time-consuming process, it's important to carefully consider your options and review your credit reports before signing up for any credit repair service.
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Frequently asked questions
Yes, you can cancel your credit repair service with Lexington Law. You can do so by online chat, and you will not be charged for any days you did not use the service. However, you may be charged a late fee for "work performed from your last payment up until that date".
Lexington Law has been the subject of lawsuits served by the Consumer Financial Protection Bureau and Minnesota's Department of Commerce. The lawsuits accuse the company of deceptive marketing practices, such as demanding upfront payment before services were delivered, which is against federal law. As a result of the lawsuit, the company was banned from telemarketing credit repair services for 10 years.
If you receive a refund check from Lexington Law, be cautious as it may be a scam. The Consumer Financial Protection Bureau (CFPB) is distributing refund checks to consumers harmed by Lexington Law's illegal upfront fees for telemarketed credit repair services. However, the CFPB will not ask you to provide money or charge a fee to cash or receive a check. You can verify if your check is real by contacting JND Legal Administration at (855) 680-8991 during business hours.
