Credit reports. Credit reporting agencies. Confused? Answers to common questions about credit reports in Q&A format.
If you’ve ever applied for a credit card, charge account, personal loan, insurance or a job, there’s a file about you. What’s in this file? It is called a credit report, and it has information about where you work and live, how you pay your bills (especially revolving credit cards), and whether you’ve been sued, arrested or filed for bankruptcy.
There are companies called credit reporting agencies (CRAs) that compile this information and sell it. What they do is give companies information about you to gauge your creditworthiness. They give this information about you to creditors, employers, insurers and other businesses. You probably know the CRAs known as credit bureaus. The three most common ones are Equifax, TransUnion and Experian.
The Fair Credit Reporting Act (FCRA) is designed to promote accuracy and ensure the privacy of the information used in consumer reports. It is enforced by the Federal Trade Commission.
Below are some commonly asked questions and answers about consumer reports and CRAs:
Q. How do I find the CRA that has my report?
A. Look in the yellow pages under “credit” or “credit rating and reporting.” The three major national credit bureaus are:
888-EXPERIAN (888) 397-3742
You are entitled to one free credit report per year from each of the above three credit reporting agencies. In addition, if you are ever denied credit, the one who denied you has to tell you which agency they got your information from, and you are then able to receive a free copy from that bureau.
Q. Do I have a right to know what’s in my report?
A. Yes, but you have to ask for it. They will tell you everything that is in your report.
Q. Is there a charge for my report?
A. Sometimes. You get one free one per year from each agency. If you just want to look at your credit report, then you have to pay for it. But if you are denied for credit, insurance or employment, and you request your report within 60 days, it is free. Fees vary from agency to agency.
Q. What can I do about inaccurate or incomplete information?
A. Under the Fair Credit Reporting Act, there is a process you must follow when disputing information.
1. Tell the CRA in writing that you dispute the information. Provide any supporting documentation that you might have.
2. The agency will investigate. It usually takes 30 days for this.
3. Then the CRA will give you written notice of the results and a free credit report.
4. If the information was inaccurate, it will be taken off your credit report.
Q. But what if the CRA says the incorrect information is accurate?
A. A reinvestigation is not always going to solve your credit issue. If the creditor says the information is correct, most likely the CRA will believe them. The best you can do is:
• Ask the CRA to file a statement that you dispute the charge
• Contact your creditor directly and resolve the issue with them first, and then ask the CRA for another investigation.
Under the Fair Credit Reporting Act if you tell the information provider that you dispute an item, a notice of your dispute must be included anytime the information provider reports the item to a CRA.
Q. Can my employer get my report?
A. Only if you approve.
Q. Can creditors, employers or insurers get a report that contains medical information about me?
A. Not without your approval.
Q. How long can a CRA report negative information?
A. Seven years, with the following exceptions:
• Criminal convictions have no time limit.
• Bankruptcy is for 10 years.
• No time limit on a job application for a $75,000 or more job.
• No time limit on insurance application of more than $150,000.
• Unpaid judgments are either for seven years or when the statute of limitations runs out, whichever is longer.
Q. Can anyone get a copy of my report?
A. No. Only those that the FCRA deems has a legitimate need can get it. For example, an insurance company when you apply for insurance can get it, but not a chicken restaurant when you buy a meal deal with 10 pieces or more.
Q. Can I stop a CRA from including me on lists for unsolicited credit and insurance offers?
A. Yes. Creditors and insurers may use information from your credit report to send you unsolicited offers. But these offers have to have a toll-free number that you can call to get your name removed from their lists.
Q. Do I have the right to sue for damages?
A. You bet you can. You may sue a CRA in state or federal court for most violations of the FCRA. If you win, the defendant will have to pay damages and reimburse you for attorney fees. But it must be for a violation of the Fair Credit Reporting Act, not because of inaccurate information.
Q. Are there other laws I should know about?
A. Yes. If your credit application was denied, the Equal Credit Opportunity Act requires creditors to specify why. But you have to ask. . For example, if you were denied because you have a short credit history, then they have to tell you that. “Just because” won’t cut it.
Q. Where should I report violations of the law?
A. Since the Fair Credit Reporting Act is enforced by the FTC, you can send them information about your experiences and concerns as it related to the Fair Credit Reporting Act. Send your questions or complaints to: Consumer Response Center – FCRA, Federal Trade Commission, Washington, DC 20580.