FCRA Credit Reporting

The Fair Credit Reporting Act, or FCRA, is a federal law that gives consumers certain rights. It covers the information that can appear in your credit report and how it may be used. Under the FCRA, you can keep your credit reports from being given to certain people or companies, and you also can dispute incorrect items. Knowing the main points of this law will help you protect your credit reporting rights.

Review

The FCRA gives you the right to review your credit reports at no cost. Each year, the three nationwide credit bureaus--Transunion, Experian and Equifax--must give you a free copy upon your request so you can see what they are reporting about you and your accounts. You also may request your credit score from agencies that calculate and sell it, but you must pay for this service.

Disputes

The FCRA gives you the right to dispute credit information you believe is being reported incorrectly. If you find negative items on your report that are erroneous, you can fill out a dispute form, and the credit bureau is required by law to investigate your dispute unless it is blatantly frivolous. If the bureau cannot verify the item, it must be removed from your report within 30 days.

Access

The FCRA gives you some control over who can access your credit report. It limits access to people and companies who have a specific, legitimate purpose for reviewing this information. Typically, this includes creditors, landlords, insurance companies and employers. You must give written permission for an employer or potential employer to access your report.

Credit bureaus sometimes sell consumer information to creditors or insurers who are pre-screening people for certain offers. If you don't want your information to be sold, call 888-567-8688 or visit the Opt Out Prescreen website to opt out of this reporting (see Resources).

Decisions

You have the right to know when information your credit report has been used to make a negative decision. The FCRA says that when a company uses your credit report to deny a loan or other credit, employment or insurance, it must give you the name, address and telephone number of the agency from which it obtained the information. You may then request a free copy of your report from the agency to review it for any incorrect items that could have influenced the decision.

Time Frame

The FCRA spells out how long negative information can stay on your report. Most negative items can be reported for seven years, but bankruptcies can be reported for up to 10 years. After this period, this information must be removed from your credit report. If it is not, you should contact the bureaus.