Credit Reporting Law
1. You have the right to know what's in your credit reports.
The act requires credit reporting agencies to give you free access to the information they have collected about you and your financial habits once every 12 months.
You are also entitled to a free annual copy of any reports that are compiled about you by , such as CoreLogic, LexisNexis and Certegy Check Services. These agencies keep records of financial data not tied to a loan - such as your rental payments, insurance claims or check-writing history - and sell them to landlords, banks, insurance representatives and others considering doing business with you.
"You hear the terminology Fair Credit Reporting Act and you think that's an act that only applies to credit reports, " says Paul Stephens, director of privacy and advocacy at Privacy Rights Clearinghouse. However, "there are these other types of agencies that exist that are essentially maintaining dossiers of consumers that go well beyond the traditional concept of credit."
Any credit reporting agency that collects financial information on you is required to honor your request for a free annual copy of your credit file. Getting your credit report from a smaller agency will take a little more work, says Stephens. "Those reports you must get directly from those companies. There is no central source to obtain [them]."
To help consumers identify which companies may be collecting their information, the Consumer Financial Protection Bureau has compiled a list of specialty reporting companies that are actively collecting consumer information. However, the list doesn't include every consumer reporting company on the market, nor does it include explicit instructions for pulling your reports. You'll have to contact each company directly and request specific directions.Every company has a different policy for responding to requests. Some companies will require that you mail a request for the report, others will provide a toll-free number.
2. Access is limited to your credit report.
If you're worried that your boss or potential sweetheart can access your credit information without your permission, don't sweat it. The act bars individuals from seeing your credit reports, unless they can prove that they have a legitimate need to see it.
"There's something that is known as the permissible purpose doctrine and that basically says that you can't just go to a credit reporting agency and say, 'I want to take a look at this person's file, '" says Stephens. "You have to have a reason to look at that file."
According to the FCRA, a person can access your credit report only if:
- A court has ordered that the credit information be shared.
- That person is a lender and you are applying for some form of credit. A creditor may also pull your report if you currently have an account open with them or if you have a balance that's past due.
- The person is working on behalf of an insurance company that's underwriting your insurance or a government agency that is considering giving you a license or other public benefit, such as social services.
- An individual has requested your report for employment purposes and has obtained your written authorization to view it.
- A person can prove a legitimate business need to view the report. For example, if a landlord is considering your rental application or a person is working on behalf of a retailer and has accepted a check as a form of payment, he or she can request a copy of your report.
- You have given clear instructions to the credit reporting agency to release your information to a particular person.
Authorized state officials or child support enforcement agents may also access your credit report if they need to verify your ability to make child support payments or determine how much you should pay.
You have the right to dispute information that is not accurate.
|- Paul Stephens
Privacy Rights Clearinghouse
Sometimes, however, credit reports do get into the wrong hands. Flitter recommends you periodically check the section of your report that lists who's pulled it. "The second-to-last page of your credit report will list everyone who has looked at your report in the last two years, " he says. If someone pulls your report without proper authorization, speak up. There are serious penalties for people who break this section of the law, says Flitter. "It's actually a felony to obtain someone else's credit report under a false pretense, " he adds.
3. If there is an error on your report, you can do something about it.
"You have the right to dispute information that is not accurate, " says Stephens.
The FCRA requires credit reporting agencies to "maintain reasonable procedures that ensure maximum possible accuracy, " says Flitter, the consumer lawyer. Even so, errors can show up on your credit report, so it's important to review your files regularly.
"Get the credit report and look at it, " says Flitter. "Examine it for accuracy to the best of your knowledge."
If you spot an error, "you must notify the credit bureau and it must conduct an investigation, " he says. If you find out about an error through other means, but don't have a fresh copy of your credit report to prove it, don't worry. As of September 2015, the credit bureaus can no longer ask for a credit report identification number when you submit a dispute.
The credit bureau has 30 days to look into your dispute, based on the information you provide to it. The credit reporting agency must also notify the furnisher of the information, such as a bank or credit card issuer, within five days of receiving your dispute and provide the furnisher with the same evidence that you gave when you flagged the error.
The data furnisher must then investigate your dispute and verify whether the information it gave to the credit bureau is correct. "If it's not verified within 30 days, then the credit bureau has to remove [the disputed error] from the credit report, " says Flitter.
Beginning in September 2016, the credit bureau must also provide you with an additional free report through AnnualCreditReport.com if it corrects an error on your report. That way, you can check to make sure all the information is correct.