Consumer reporting agencies collect, maintain and sell information on millions of consumers. Consumer reporting agencies include the three major credit bureaus Experian, Transunion and Equifax but they also include specialty agencies like ChexSystems that sell information about check writing histories, and other agencies that maintain medical records, insurance information and rental history records.
With so many consumer reporting agencies storing, maintaining and selling consumer information there has to be some laws to protect consumers. The federal Fair Credit Reporting Act (FCRA) promotes the accuracy, fairness and privacy of information in the files of consumer reporting agencies.
The FCRA requires consumer reporting agencies to maintain accurate and complete files. Here is a summary of how the FCRA helps consumers.
You have the right to know if information in your file has been used against you. Anyone who uses a credit report or another type of consumer report to deny your application for credit, insurance, or employment – or to take another adverse action against you – must tell you, and must give you the name, address, and phone number of the agency that provided the information.
Who can view your information. Access to your file is limited. A consumer reporting agency may provide information about you only to people with a valid need — usually to consider an application with a creditor, insurer, employer, landlord, or other business. The FCRA specifies those with a valid need for access.
Errors in your credit report. You have the right to dispute incomplete or inaccurate information. If you identify information in your file that is incomplete or inaccurate, and report it to the consumer reporting agency, the agency must investigate unless your dispute is frivolous. Consumer reporting agencies must only report accurate information. Inaccurate information must be corrected or deleted. This is your main weapon against in repairing your credit. Learn how to dispute your credit. If you are unsatisfied with the investigation results or correction, you have the right to add a brief statement (100 words or less) about the issue to your credit report.
You have the right to know what is in your file. A consumer reporting agency must disclose your file to your upon request. You are entitled to a free report once every 12 months. To obtain a free credit report from Experian, Transunion and Equifax visit: www.annualcreditreport.com. Other specialty consumer reporting agencies must also provide a free report upon request once every 12 months.
You have the right to ask for a credit score. Credit scores are numerical summaries of your credit-worthiness based on information from credit bureaus. You may request a credit score from consumer reporting agencies that create scores or distribute scores used in residential real property loans, but you will have to pay for it. In some mortgage transactions, you will receive credit score information for free from the mortgage lender.
Consumer reporting agencies must correct or delete inaccurate, incomplete or unverifiable information. Inaccurate, incomplete or unverifiable information must be removed or corrected, usually within 30 days. However, a consumer reporting agency may continue to report information it has verified as accurate.
Consumer reporting agencies may not report outdated negative information. 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.
Delete outdated information. In general, negative information that is more than 7 years old (10 years for bankruptcies) must be removed from your file.
Opting Out. The credit reporting agencies make money by selling your information. Consumer reporting agencies can sell lists of consumer names and addresses whose credit information matches the requirements of creditors and insurers for making firm offers of credit or insurance. Remove your name from marketing lists upon request. Opting out of marketing lists protects your information. The marketing lists are not only sold to companies wanting to send you unsolicited credit offers, they are also sold to collection agencies and those who purchase debts. When you opt-out, your information will only be given to someone with “Permissible Purposes”. You can Opt-Out online or via telephone. Visit www.optoutprescreen.com or call 1-888-5-OPT OUT.
You may seek damages from violators. If a consumer reporting agency, or, in some cases, a user of consumer reports or a furnisher of information to a consumer reporting agency violates the FCRA, you may be able to sue in state or federal court.
Add identity theft and active duty alerts. Identity theft victims may place fraud alerts and active duty military personnel serving away from their regular duty station may place “active duty” alerts to help prevent identity theft.
Remedying the Effects of Identity Theft. If you are, or believe that you are, the victim of identity theft, you have specific rights under the FCRA. These rights will help you deal with the effects of identity theft.