ESCRA Act
Sponsored By: Representative McBride
Introduced
Summary
Crack down on deceptive credit repair practices. The bill tightens rules for credit repair organizations by requiring state licensing, stronger disclosures to consumers, and a knowingly standard for false claims to regulators and law enforcement.
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- Consumers: CROs cannot collect payment for services unless they provide documentation from a consumer reporting agency showing success at least six months after the service. Consumers must get copies of all communications sent on their behalf and be told that the Bureau of Consumer Financial Protection regulates CROs.
- Credit repair organizations and attorneys: All CROs must be licensed by a state starting in 2026, keep telephone recordings, retain records for five years, and face new limits on filing repeat disputes. The bill also creates a minimum civil remedy of $500 per violation.
- Furnishers and dispute handling: Disputes must include the CRO name and license number and give furnishers 15 business days to respond when they request clarification.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 2 benefits, 1 costs, 1 mixed.
Stronger rules for credit repair services
If enacted, credit repair companies would face tighter service rules. Mailed disputes would use first-class mail and show the company name and any state license number. Firms must reply in writing within 15 business days when asked for more information, and cannot refile the same dispute unless strict conditions are met. They could not take payment until they give you a consumer report at least six months later that proves the result. You would get copies of every message sent for you, and disclosures would say you can do these steps yourself for free and list the Bureau’s contact: 1700 G St. NW, Washington, DC 20552; 855-411-2372; TTY/TTD 855-729-2372.
State license needed by Jan 2026
Starting January 1, 2026, anyone acting as a credit repair organization would need a state license. If you run a credit repair business, you would have to secure licensing to keep operating.
Easier complaints and $500-per-violation damages
If enacted, you could seek $500 for each proven violation of the credit repair law. You could file complaints with the Consumer Financial Protection Bureau, the Federal Trade Commission, or law enforcement, including through online portals. At the same time, false-statement cases would require proof the company acted knowingly, which could be harder to show.
Clearer attorney carve-outs in credit repair
If enacted, the bill would clarify who counts as a credit repair organization. Most businesses would still be covered even if they employ attorneys. But an attorney’s legal services tied to a bankruptcy or similar case to be filed within 12 months by someone in the same law firm would be carved out. Money paid for preparing for or during litigation would not count as credit repair fees.
Sponsors & CoSponsors
Sponsor
McBride
DE • D
Cosponsors
Rep. Kim, Young [R-CA-40]
CA • R
Sponsored 1/9/2025
Rep. Bynum, Janelle S. [D-OR-5]
OR • D
Sponsored 2/3/2026
Rep. Lawler, Michael [R-NY-17]
NY • R
Sponsored 2/3/2026
Rep. Gottheimer, Josh [D-NJ-5]
NJ • D
Sponsored 2/3/2026
Rep. Fitzpatrick, Brian K. [R-PA-1]
PA • R
Sponsored 2/3/2026
Rep. Sherman, Brad [D-CA-32]
CA • D
Sponsored 4/14/2026
Van Drew
NJ • R
Sponsored 4/14/2026
Roll Call Votes
No roll call votes available for this bill.
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