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What is the Fair Credit Reporting Act?
The Fair Credit Reporting Act
(FCRA) is a federal law that regulates the activities of credit
reporting bureaus. Private credit reporting bureaus, such as TRW
Information Services, Equifax Credit Information Services, and Trans
Union Credit Information Company, maintain records of financial payment
histories, public record data (such as unlawful detainer (eviction)
actions taken against you, or money judgments (entered against you),
along with personal identification information. Credit reporting
bureaus sell the information to creditors so the creditors can make
decisions about whether or not to offer you credit.
The FCRA
punishes unauthorized persons who obtain credit reports, as well as
employees of credit reporting bureaus who furnish credit reports to
unauthorized persons. The Act also specifies responsibilities of those
supplying the reporting bureaus with information.
If the
information about you from a credit reporting bureau is all good,
there's no need to worry about it. You should be able to obtain credit
to purchase goods and services, rent an apartment, obtain a home
mortgage loan, apply for insurance, and even obtain employment.
Negative
information on file with credit reporting bureaus may be used against
you to deny you credit, employment, or even the ability to rent an
apartment. It is a good idea to check your credit reports on an annual
basis, so that you know what creditors are being told before the
information is disclosed to them. Credit reporting bureaus are allowed
to charge you a reasonable fee to obtain a copy of your credit report
in this situation.
When credit is denied to you based upon
information obtained from a credit reporting bureau, the creditor must
provide you with the credit reporting bureaus' name and address. If you
request (by telephone, mail or in person) a copy of your credit report
from the credit reporting bureau within thirty days of the denial, the
bureau must send your credit report to you for free, including the
names of creditors who have provided the information to the bureau, and
the names of everyone who has received a credit report on you in the
last six months, or an employment report in the last two years.
If
the information provided in a credit report turns out to be inaccurate
and corrections are made or the consumer inserts an explanation, the
credit reporting bureau must notify the recent recipients of
information (as specified by the consumer) of the corrections or
explanation.
The consumer reporting bureau must delete
information about events that happened more than 7 years before from a
report (or 10 years in case of bankruptcies).
(Reviewed 10.31.08)
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