Fair Credit Reporting Act Summary - Your Consumer Right

The Fair Credit Reporting Act or FCRA was passed under Federal Law to promote the protection of peoples consumer rights by ensuring the data that is collected about them is reported accurately and fairly. The act was also passed to protect the privacy of consumer data.

When you apply for any kind of credit whether it be a credit card or loan your personal and financial details will be kept on record.

This information is collected and compiled into what is called a consumer credit report or file by consumer reporting agencies that include credit bureaus. This information can be sold to banks, insurance companies upon request if they need to check the credit history of a person who is applying for credit.

The following Fair Credit Reporting Act summary will help you gain a greater understanding of your rights as a consumer:

1) You must be informed if details in your credit report have been used to deny you credit

If a company has rejected your application for a loan, mortgage,insurance or job based on the information on your file then, that company must inform you of this. Also, any creditors who deny you credit must inform you of the consumer agency who provided them with you credit file.

2) You have full disclosure of your credit files

Whatever information is collected about you then, you have the right to know about it. Credit consumer agencies sell your credit account information to other companies therefore, you have the right to see it too especially as the information is about you!

Under certain circumstances you can obtain your credit file free of charge within 60 days if the following has happened:

You have been denied from obtaining any kind of credit, insurance or a employment.
You are applying for a job within the next 60 days.
Details on your file have been compromised due to willful or negligent fraud or identity theft.

The Federal Trade Commission has now set up its very own site the www.annualcreditreport.com which enables people to download once a year for free a copy of their credit report from the three major credit bureaus.

3) Consumer agencies must disclose your credit score upon request.

The credit score is used by banks and other lenders to determine your credit risk. They calculate this score utilizing a variety of financial data and debt information contained on your credit report. Unlike your credit report you will have to pay a fee to obtain your score.

4) You can dispute any details on your credit file that are out of date and wrong

Details on your file could be wrong and out of date. These inaccuracies could lower your credit score and should be checked as soon as possible. Under the Fair Credit Reporting Act you have the right to dispute any details on your file that you feel are inaccurate and out of date.

You can do this by sending the relevant agency a dispute letter backed up by evidence to support your case. The agency must consider your file within 30 days of receiving your dispute letter. The agency has to remove or update any information that can be verified as out of date or inaccurate.

5) Negative entries must be reported by the agencies when they expire.

Certain negative entries such as chapter 7 bankruptcy must stay on your credit file for a period of 10 years. However, after 10 years the consumer reporting agencies can no longer report this on entry on your file.

6) Valid companies can only have access to your credit files.

Each credit agency must allow access to those companies that have a valid reason to do so. For example, valid reasons would be a credit card provider needing to check your file before they issue you a new card. Another, vaild reason would be a potential employer needing to check your credit file during the recruitment process.

7) In certain cases agencies cannot grant access to your file unless you give them the consent to do so.

This ruling relates to certain employers who request your file during the recruitment process. They agency must inform of this access request and ask you for written consent. However, certain industries such as the trucking industry or exempt from this ruling.

8) Reduce the number of unsolicited financial offers.

If you are bombarded with mailers regarding unsolicited financial and insurance offers then under the Fair Credit Reporting Act summary you can reduce these. Under FCRA unsolicited financial offers have to provide toll free contact number. You can use this number and ask the company to remove your contact details from their database and mailing lists.

9) Your right to sue agencies and companies that violate the Fair Credit Reporting Act.

You can sue in Federal court a consumer reporting agency commercial company or third part issuer of your file if they have abused have abused or transgressed the regulations within the act.

Credit Repair Articles

Restore Credit Score

credit score rating scale

What Is Considered A Good Credit Score

What Is A Bad Credit Score?

Credit Repair Solution

Do It Yourself Credit Repair In 4 Simple Steps

Credit Repair Scams And How To Avoid Them

How To Get Credit Reports From All Three Bureaus For Free

How To Improve Credit History In 3 Simple Steps

How To Improve Bad Credit Scores

Best Credit Repair Companies | Top 5 Review