The Fair Credit Reporting Act (FCRA), is enforced by the Federal Trade Commission and designed to insure accuracy and privacy of the information used in consumer credit reports. Recent amendments expand your rights and place additional requirements on your information and how it is used. Any company that supplies information about you to credit reporting agencies and those that use consumer reports must abide by these rules.
Here are your rights under the Fair Credit Reporting Act
1) Credit reporting agencies must tell you everything in your report,
including medical information, and in most cases, the sources of the
information. They must also provide you with a list of everyone who has requested your report within the past year.
2) There's no charge for a credit report if a company takes adverse action against you, such as denying your application for credit, insurance or employment. Under the FCRA rules you must request your report within 60 days of receiving the notice of the action. The notice will give you the name, address, and phone number of the credit reporting agency.
3) The FCR act requires credit agencies responsibility for correcting
inaccurate or incomplete information in your report. Contact the credit agency if you find information you believe is inaccurate. They must reinvestigate the items you believe are wrong. Also must send all data you provide about the dispute to the information provider. After the information provider receives notice of a dispute it must investigate the information provided and report the results to the credit agency. If the information provider finds the disputed information to be inaccurate they are required to notify all credit agencies so they can correct this information in your file. After the investigation is complete the agency must give you the written results and a free copy of your report if the dispute results in a
4) Investigative consumer reports are detailed reports that involve
interviews with your neighbors or acquaintances about your lifestyle, character, and reputation. They may be used in connection with insurance and employment applications. You'll be notified in writing when a company orders such a report. The notice will explain your right to request certain information about the report from the company you applied to. If you apply for credit and your application is rejected, you may get additional information from the credit agency. However, they do not have to reveal the sources of the information.
5) Here is how long information stays on your credit report.
A) Most credit information stays on your report for seven years.
B) Information about criminal convictions may be reported without any time limitation.
C) Bankruptcy information may be reported for 10 years.
D) Information reported in response to an application for a job with a
salary of more than $75,000 has no time limit.
E) Information reported because of an application for more than $150,000 worth of credit or life insurance has no time limit.
F) Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out.
The Fair and Accurate Credit Transactions Act of 2003 (FACTA) attempts to help ensure that all Americans, of every income level and background, are able to build good credit and confront the problem of identify theft and receive free credit reports.
The FACTA is an attempt to update and modify FCRA in the following ways:
1) Ensuring that lenders make decisions on loans based on full and fair credit histories, and not on discriminatory stereotypes. In 1996, uniform national standards were established to set clear rules on what credit agencies were entitled to include in individual credit reports, and now more than a million Americans have credit as a result. This legislation makes those national standards permanent.
2) Improving the quality of credit information, and protecting consumers against identity theft.
A) Giving every consumer the right to their credit report free of charge every year. Consumers will be able to review a free report every year for unauthorized activity, including activity that might
be the result of identity theft.
B) Helping prevent identity theft before it occurs by requiring merchants to leave all but the last five digits of a credit card number off store receipts. This law will make sure that slips of paper that most people throw away do not contain their credit card number, a key to their financial identities.
C) Creating a national system of fraud detection to make identity thieves more likely to be caught. Previously, victims would have to make phone calls to all of their credit card companies and three major credit rating agencies to alert them to the crime. Now consumers will only need to make one call to receive advice, set off a nationwide fraud alert, and protect their credit standing.
D) Establishing a nationwide system of fraud alerts for consumers to place on their credit files. Credit reporting agencies that receive such alerts from customers will now be obliged to follow procedures to ensure that any future requests are by the true consumer, not an identity thief posing as the consumer. The law also will enable active duty military personnel to place special alerts on their files when they are deployed overseas.
F) Requiring regulators to devise a list of red flag indicators of identity theft, drawn from the patterns and practices of identity thieves. Regulators will be required to evaluate the use of these red flag indicators in their compliance examinations of financial institutions, and impose fines where disregard of red flags has resulted in losses to customers.
G) Requiring lenders and credit agencies to take action before a victim even knows a crime has occurred. With oversight by bank regulators, the credit agencies will draw up a set of guidelines to identify patterns common to identity theft, and develop methods to stop identity theft before it can cause major damage.