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Your Rights When
Dealing With Credit Bureaus |
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If you have ever applied for a credit account, mortgage loan, or insurance policy, a credit reporting bureau is keeping a file on you. These organizations gather information about people’s credit histories and provide reports based on that information to companies considering them for loans or credit cards.
For many people, credit bureaus are a source of fear and frustration. However, by educating yourself on your legal rights, you can ease those feelings and take steps to make sure the information is correct and fair.
Your most effective weapon in dealing with the credit bureaus is the Fair Credit Reporting Act, passed by Congress in 1970 and enforced by the Federal Trade Commission. Legally, the FCRA protects you by requiring credit bureaus to furnish correct and complete information to companies requesting credit histories for evaluation. These reports typically are used to evaluate applicants for loans, credit cards, insurance and employment.
If you suspect, for any reason, that your credit history has been misrepresented, there are several steps you can take. First, you have to locate the credit bureau that has your file. If credit is denied because of information supplied by a credit bureau, the company that denied your application must tell you the name and address of the bureau. You can also find local branches of credit reporting agencies in the Yellow Pages and call them directly.
It’s important to remember that these bureaus are only required to send you a copy of your credit report if you ask for it. It doesn’t arrive automatically by mail with a rejection for credit. You must request it, which can usually be handled with a phone call. You are entitled to know all information on the report, as well as the sources of that information in most cases.
You are also entitled to know who has received a report on you in the previous six months — the previous two years, if for the evaluation of a job application. Also, if a credit bureau’s information is the reason you are denied for credit, the report is free, but you have to request it within 30 days. Otherwise, the bureau may charge a nominal fee.
Once you’ve received the credit report, read it thoroughly. If you find a mistake, there are steps you can take. First, notify the bureau and ask them to investigate. They are required to investigate the item in question and remove it if proved to their satisfaction.
If that doesn’t resolve the dispute, you have the right to add a detailed consumer statement to your credit file. The bureau is then required to attach that statement to your credit history report. For example, if you are divorced and have a defaulted loan on your credit report that was caused by a spouse during a trial separation, briefly describe the situation along with any facts that support your claim that the problem was not your fault. If your application is a close call between approval or denial, this statement could make the difference.
Finally, if you still cannot resolve disputes with a credit reporting bureau, and you feel a violation of the FCRA may have taken place, it may be worth the effort to contact an attorney because it doesn’t come off your record for at least seven years — ten years if it’s a bankruptcy. Also, report it to the Federal Trade Commission, Washington, DC 20580. While they cannot act as legal counsel in private disputes, your information may be vital to the enforcement of the FCRA.
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