You've heard about having rights to a fair credit report. Here, in plain English, is a list and explanation of your most important rights under the Fair Credit Reporting Act (FCRA).
Our country runs on credit and credit information and the credit reporting behind them. Of course there are the obvious uses of credit to purchase things, but as more and more people are finding out, credit reports are used for much more than that – they often impact employment decisions, housing decisions and rates, business equipment lease rates, and insurance availability and price, among other things. Bad credit has a high price in so many ways.
As important as all the interests affected by it are, the credit reporting network (the businesses which create and publish your credit information) is a vast and largely faceless bureaucracy. The federal Fair Credit Reporting Act (FCRA) was designed to create some accountability in this network and protect consumers from some of its abuses. The FCRA was designed to safeguard the accuracy, fairness and privacy of information in the files of consumers held by the reporting agencies.
There are many different kinds of consumer reporting agencies – almost everybody knows about the credit bureaus, of course, and there are also specialty agencies that sell information about check writing histories, medical records and rental history records. The FCRA was directed primarily at these agencies, rather than the creditors or companies with which you normally do business.
This isn't a complete, exact replication of your rights under the Fair Credit Reporting Act. As with most important laws, the exact rights and their limits change as courts interpret the laws. But this will give you an accurate overview - a place to start.
A consumer reporting agency may provide information about you only to people with a valid need - considering an application with a creditor, insurer, employer, landlord, or other business. The FCRA specifies those with a valid need for the information. And in most cases you must give your consent before the information is obtained or used.
Anyone who uses a credit report or another type of consumer report to deny an application for credit, insurance, or employment – or to take other adverse actions against you – must tell you, and must give you the name, address and phone number of the agency that provided the information. You are entitled to a free copy of that report.
You can find out all the information about you in the files of a consumer reporting agency. You must be offered a free disclosure if:
All consumers will be entitled to one free disclosure every 12 months upon request from each nationwide credit bureau and from nationwide specialty consumer reporting agencies.
If you identify information in your file that is incomplete or inaccurate and report it to the consumer reporting agency, the agency must conduct a “reasonable” investigation, and it must report the information as disputed. If it is unable to verify the information after investigation, the agency must remove or correct the entry.
For practical reasons, this provision may actually provide more important rights against the businesses that report credit events (the debt collector reporting a debt as unpaid, for example) than against the reporting bureaus.
In most cases, a consumer reporting agency may not report negative information that is more than seven years old, or bankruptcies that are more than 10 years old.
Click here for a copy of the FCRA in pdf form. For help defending yourself from debt collectors or protecting your rights as a consumer,we recommend the Debt Master Series Collection, which shows you how to use the laws of debt collection and credit repair to your advantage as you force the debt collectors to leave you alone and then move to restore your credit. If you are not worried about or being sued, you will just want the Credit Repair Manual.
Check out our Guide to Legal Research and Analysis for a guide to researching and laws and cases in the most effective way. But legal research is more about what you do with what you find, and so this is a primer on legal thinking and analysis as well.