#the fair credit reporting act
The Fair Credit Reporting Act and Your Credit Report Rights
We expect that our credit report and the information surround it is safe when passed from credit reporting agencies to companies or individuals requesting it. The Fair Credit Reporting Act (FRCA) was created to make sure that’s indeed the case.
The Act regulates the collection, dispersing of, and storage of your credit information. Basically, it regulates the way reporting agencies are allowed use your information.
If you find someone has violated the FRCA, you may be able to sue them. Talk to an attorney about your options. In the meantime, keep reading for more information on your rights under the Act.
What Do the Credit Reporting Agencies Do?
Credit reporting agencies (CRAs) have access to your credit report. These reporting agencies are the companies that collect and send out your credit information.
Companies contact the CRAs when doing credit checks. These credit checks are performed for many reasons, including for employment checks, loan and credit card approvals, apartment rental applications and banking account approvals.
Because your credit information is so sensitive, the FCRA governs the agencies that hold this valuable information.
How Does the FCRA Protect Me?
Originally written and put into law in 1970, the FCRA has had multiple revisions to evolve with modern times. So what are some of the features of the Fair Credit Reporting Act and how does it protect you?
Under the FCRA, You Get a Free Credit Report from EACH CRA
Under the FRCA, you are entitled to one free credit report a year from each credit reporting agency, which is accessible by mail, phone or through annualcreditreport.com.
When you request the report, the CRAs must disclose your credit information that they have on file about you.
Also, if you live in certain states, you are entitled to more than one a year from each CRA. States that allow you to receive more than one credit report a year include:
- New Jersey
- Puerto Rico
Only Authorized People/Companies Can Get Your Credit Info
Under this Act, only authorized individuals or companies can request and receive your credit information. Not just anyone can pull your credit history.
Also, a CRA must receive written permission from you via your employer or potential employer before sending your credit information over to them.
Your Negative Credit Information Has an “Expiration Date”
Negative information can generally only stay on your credit records for seven and a half years.
An exception to this rule is if you have a personal bankruptcy filing on your report. These bankruptcies can stay on your report for as long as ten years.
You Have the Right to Dispute Inaccurate Information
Mistakes happen – and at CreditReportProblems.com, we have seen them all. In fact, did you know that one in every five Americans has a mistake on their credit report?!
The FRCA understands that errors can happen, which is why it gives consumers the right to dispute inaccurate information. This is also why we should actively monitor our credit reports.
How to Use the FRCA to Dispute Errors On Your Credit Report
If you notice an error on your report, notify the credit bureau via mail or an online form.
TIP: In the event that you feel that your identity is compromised, you can put a freeze on your credit report for a period of 90 days so no one can access it.
Once the credit report agency receives your dispute, they forward the dispute form to the furnisher and then they perform their investigation and report back with the revised/corrected information.
Both the credit report agency and the furnisher (a bank or creditor) are supposed to do independent investigations. The furnisher can be a bank or creditor.
Unfortunately, most CRAs do not spend much time investigating which leads to non-removal of the error. This means that second or third attempts are sometimes needed but do not guarantee the error will be resolved.
You can also contact an experienced attorney. They may be able to quickly resolve the matter for you.
For the full transcript of the Fair Credit Reporting Act, you can read the FTC.gov pdf of the Act (warning, it’s 84 pages!).