Your credit report contains important information about you. It
generally includes facts about where you work and live and your bill-
paying habits. It also may state whether you've been sued or arrested or
have filed for bankruptcy. Companies called credit reporting agencies or
credit bureaus compile and sell your credit report to businesses, which
use it to evaluate your applications for credit, insurance, employment,
and other purposes allowed by federal law. Therefore, it is important
that your credit report contain complete and accurate information.
Some financial advisors suggest that you review your report every three
or four years to check for inaccuracies or omissions. You also may want
to check your report sooner if considering a major purchase, such as
buying a home.
HOW TO OBTAIN YOUR CREDIT REPORT
If you have been denied credit, insurance, or employment because of
information that was supplied by a credit reporting agency, the Fair
Credit Reporting Act requires the report recipient to give you the name
and address of the credit reporting agency that supplied the information.
If you contact that agency to learn what is in your file within 30 days of
receiving the denial notice, your report is free.
If you simply want a copy of your report, call the credit reporting
agencies listed in the Yellow Pages under "credit' or "credit rating and
reporting." Call each reporting agency listed since more than one agency
may have a file on you, some with different information. You may have to
pay a reasonable charge for each report.
HOW TO CORRECT ERRORS
You have the right, under the Fair Credit Reporting Act, to dispute the
completeness and accuracy of information in your credit file. When a
credit reporting agency receives a dispute, it must reinvestigate and
record the current status of the disputed items within a "reasonable
period of time," unless it believes the dispute is "frivolous or
irrelevant." If the credit reporting agency cannot verify a disputed
item, it must delete it. If your report contains erroneous information,
the credit reporting agency must correct it. If an item is incomplete, the
credit reporting agency must complete it. For example, if your file
showed that you were late in making payments on accounts, but failed to
show that you were no longer delinquent, the credit reporting agency must
show that your payments are now current. Or if your file showed an
account that belongs only to another person, the credit reporting agency
would have to delete it. Also, at your request, the credit reporting
agency must send a notice of correction to any report recipient who has
checked your file in the past six months.
If a reinvestigation does not resolve your dispute, the Fair Credit
Reporting Act permits you to file a statement of up to 100 words to
explain your side of the story. The credit reporting agency must include
this explanation in your report each time it sends it out. Credit
reporting agency employees often are available to help you word your
Be aware, however, that when negative information in your report is
accurate, only the passage of time can assure its removal. Credit
reporting agencies are permitted by law to report bankruptcies for 10
years and other negative information for 7 years. Also, any negative
information may be reported indefinitely for use in the evaluation of your
- $50,000 or more in credit;
- a life insurance policy with a face amount of $50,000 or more; or
- consideration for a job paying $20,000 or more.
HOW TO REGISTER A DISPUTE
You must make your dispute directly to the credit reporting agency.
Although the Fair Credit Reporting Act does not require it, the Federal
Trade Commission staff recommends that you submit your dispute in writing,
along with copies (NOT originals) of documents that support your position.
In addition to providing your complete name and address, your letter
should clearly identify each item in your report you dispute, explain why
you dispute the information, state the facts, and request deletion or
correction. You may want to enclose a copy of your report with the items
in question circled.
Send your dispute by certified mail, return receipt requested, and keep
copies of your dispute letter and enclosures. By doing so, you can
document what the credit reporting agency received.
ADDING ACCOUNTS TO YOUR FILE
Your credit file may not reflect all of your credit accounts. Although
most national department store and all-purpose bank credit card accounts
will be included in your file, not all creditors supply information to
credit reporting agencies. Those not reporting to credit reporting
agencies include, for example, some travel, entertainment, and gasoline
card companies, local retailers, and credit unions.
If you have been told that you were denied credit because of an
"insufficient credit file" or "no credit file" and you have accounts with
creditors that do not appear in your credit file, you can ask the credit
reporting agency to add this information to future reports. Although they
are not required to do so, many credit reporting agencies will add other
verifiable accounts for a fee.
excerpted from material by the Federal Trade Commission
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