Established in 1970, The Fair Credit Reporting Act (FCRA) helps control who can access your personal information and what they can do with it. With three major credit reporting agencies in the United States, clarification of your rights is essential. Make sure you know how you are protected before getting taken advantage of.
Who Gets Your Info?
Agencies are required to disclose your information should you request it. You must provide written consent to third parties, including rental companies and employers, before they can gain access to the information in your credit report. It is important to know that while there is limited access to reports, those with a “permissible purpose” including debt collectors, those with a court order, and insurance companies may have access to the information in your credit report.
Keep Track of and Report Discrepancies
If something seems wrong, challenge it. Incorrect data presented on credit reports can hurt more than you think. Under the FCRA, inaccurate information must be corrected or deleted. Outdated information is generally considered any negative data over seven years and must be deleted as well. Inaccurate and unclear information posted on credit reports may make consumers appear less creditworthy, making it difficult or more expensive for consumers to obtain credit.
According to the Cook County Record, Joseph Underwood filed a lawsuit claiming that Equifax had incorrectly reported that he was late making his child support payments despite his report of a discrepancy with the Texas Office of the Attorney General. In actuality, the Texas had over-drafted its automatic payments from Underwood, taking more than he was required to pay and incorrectly reporting that he had an outstanding child support obligation.
A woman in Illinois recently filed a lawsuit against all three major credit agencies claiming that they reported false past due balances. Despite the fact she had previously filed for bankruptcy, which would dismiss any owed money, she claims that her discharged debts were still being reported on her credit reports as outstanding debts.
Know Your Numbers
Your credit history can make or break a purchase or loan, but do you know which numbers determine this? Probably not, and credit agencies know that. Earlier this year, Equifax and TransUnion were both fined more than $5 million by the Consumer Financial Protection Bureau for selling credit scores that are not typically used by lending companies. The agencies were also ordered to pay more than $17 million to misled consumers.
Identity Theft Prevention
The use of debit and credit cards in everyday life is becoming more common these days, making users more vulnerable to identity theft. The FCRA can help victims by setting up fraud alerts. Active duty military personnel can also place alerts designed especially for them. Even after the unfortunate situation one becomes a victim of identity theft, the FCRA can help minimize the impact.
Farmer Jaffe’s Seth Lehrman helps consumers protect their rights under the FCRA. He can be reached at [email protected] or at 1-800-400-1098 during business hours on Eastern Standard Time.