The FCRA or the Federal Credit Reporting Act is a federal law that governs the collection and distribution of consumer credit information. It promotes the truthfulness, fairness and discretion of the personal credit information that is collected by credit reporting agencies. It was originally enacted back in 1970 and the latest amendment took place in December 2003.
Credit reports are common and often used in the United States. The primary intent of a credit report was to evaluate the creditworthiness of a person for getting credit but now credit reports are also used for such things as insurance underwriting and employment applications. As of this time, it is entirely lawful for an individual to be denied insurance or denied or terminated employment on the basis of what is contained in a credit report.
A credit-reporting agency is a business that collects, compiles and sells credit information on consumers. In the United States there are three major credit-reporting companies, TransUnion, Experian and Equifax.
The FCRA was enacted to guard consumers from incomplete, unjust and mistaken information on a credit report. It gives consumers the right to dispute and contest any information on a credit report that is considered to be imprecise or erroneous in any way. If there is untruthful information showing on your credit report you have the choice to issue a dispute to the credit bureaus. They will have 30 days from acknowledgment of your dispute to either substantiate the correctness of what they are reporting or delete it from your report.
Under the FCRA, a consumer is also allowed to obtain one free credit report from each of the credit bureaus one time per year. In order to collect your credit report you just need to submit a request. If you are turned down for credit because of something that is listed on your credit report you too have a right at that time to receive a report. The credit bureau that is reporting the derogatory information must provide a credit report to the consumer.
Often poor credit listings are removed from credit reports after a dispute because the credit bureaus were unable to corroborate the truthfulness within the time period. If information is removed the credit bureaus cannot reinstate the listing without notifying the consumer in writing. You can visit http://724credit.com for more information.
The Federal Credit Reporting Act in addition clearly outlines the amount of time that bad information can be retained on a credit report. Most often all listings can only remain on the credit report for 7 years from the time of delinquency. A bankruptcy can stay on the report for 10 years and a tax lien can stay for 7 years after it is paid off.
It is worth the time and energy it takes for a consumer to issue a dispute to the credit bureaus. It has been projected that as many as 40% of all disputed listing are deleted because the information cannot be validated within the time period. Accurate and truthful information should not be disputed and should remain on the credit report but a consumer should try to get all incorrect information removed through the dispute procedure given by the Federal Credit Reporting Act.
Your credit report is more important than you may recognize, To learn more about your credit score click here.
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