The Fair Credit Reporting Act (FCRA) regulates the collection, dissemination, and use of consumer information, including consumer credit information. Along with the Fair Debt Collection Practices Act (FDCPA), it forms the base of consumer credit rights in the United States. The FCRA was originally passed in 1970, and is enforced by the Federal Trade Commission and private litigants. The information in your credit report is used to evaluate your application for credit, insurance, employment, and renting a home. Therefore, you should be sure the information is accurate and up-to-date.
Additionally, monitoring your credit is one of the best ways to spot identity theft. Consumer reporting agencies (CRAs) are entities that collect and distribute information about consumers to be used for credit evaluation and certain other purposes, including employment.
Credit bureaus, a type of consumer reporting agency, hold a consumer’s credit report in their databases. Consumer reporting agencies have a number of responsibilities under FCRA, including the following:
- Provide a consumer with information about him or her in the agency’s files and to take steps to verify the accuracy of information disputed by a consumer.
- Consumers are able to receive one free credit report a year.
- If negative information is removed as a result of a consumer’s dispute, it may not be reinserted without notifying the consumer within five days, in writing.
- CRAs may not retain negative information for an excessive period.
The FCRA describes how long negative information, such as late payments, bankruptcies, tax liens, or judgments may stay on a consumer’s credit report — typically seven years from the date of the delinquency. An information furnisher, as defined by the FCRA, is a company that provides information to consumer reporting agencies. Typically, these are creditors, with which a consumer has some sort of credit agreement. For example, credit card companies, auto finance companies, mortgage banking institutions, collection agencies (third-party collectors), and court judgments. Under the FCRA, these information furnishers may only report to a consumer’s credit report under specified guidelines. Information furnishers have an important role to play in ensuring credit reports are accurate. Some of these guidelines include:
- They must provide complete and accurate information to the credit reporting agencies.
- The duty to investigate disputed information from consumers falls on them, and they must correct an error, or explain why the credit report is correct within 30 days of receipt of notice of a dispute.
- They must inform consumers about negative information which has been or is about to be placed on a consumer’s credit report within 30 days.
It is crucial that you check your credit report at least once a year to correct errors and detect unauthorized activity. Contact Agruss Law Firm, LLC, for help receiving your free credit report. More importantly, contact Agruss Law Firm, LLC, for help disputing inaccurate information in your credit report.