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The Fair Credit Reporting Act (FCRA) protects against the misuse and misreporting of your credit information. When creditors, collectors, or credit reporting agencies violate the provisions of the FCRA, it can cause lower credit scores, denials of credit, higher interest rates on loans and credit extensions, and more. It's important to recognize when the FCRA has been violated so you can take action and prevent harm to your credit.
The FCRA governs consumer reporting agencies, also called "credit bureaus," and the businesses or individuals that report information to the consumer reporting agencies. The agencies compile this information into your credit reports.
Your credit reports serve an important purpose. They can determine whether you can obtain a mortgage, car loan, job, and even an apartment.
The FCRA tells credit reporting agencies, creditors, and other authorized persons what they can and can't do with your credit information.
Where Can I Get Copies of My Credit Reports?
The credit reporting agencies will provide you with free weekly reports online, a service they started during the COVID-19 pandemic. Go to AnnualCreditReport.com to get them.
Here are some of the more common ways that creditors, collectors, and credit bureaus violate the FCRA.
Credit reporting agencies and the creditors who supply information to them must provide and keep your credit information current. When your credit circumstances have changed, and the information in your credit report isn't updated to reflect these changes, this failure might be a violation of the FCRA.
Some examples of violations include:
Your creditor must not supply information to a credit reporting agency that it knows (or should know) is inaccurate. That kind of information includes:
Credit reporting agencies can also run afoul of their obligations to report accurate credit information about you. In many instances, this violation happens when a credit bureau mixes your file with that belonging to someone else with similar background information.
Some common cases of mixed files include:
When you submit a written dispute about the accuracy of an item on your report, the credit bureaus and your creditors must take certain actions in response. Their duties include conducting a reasonable investigation of your dispute, correcting any inaccurate information, or even removing the disputed debt from your credit reports.
A credit reporting agency or creditor can also fall short of its duties in a number of other ways.
Some common violations by credit reporting agencies include failing to:
Credit reporting agencies can't release your credit reports to just anybody. They can only give them to authorized persons. The agencies may disclose your report only to persons or entities that have a valid need, such as:
Even though your employer, creditor, or landlord might be allowed to pull your credit report, they must still have a permissible purpose to do so. If someone pulls your credit report for an impermissible purpose, then it might be a violation of the FCRA.
Some examples of impermissible purposes include:
You're entitled to notices concerning the reporting, handling, and use of your credit information. Notice violations under the FCRA might occur when:
If any of these three types of entities (credit bureau, creditor, or information user) violated your rights under the FCRA, you might be able to sue them in state or federal court for damages. To learn more about your rights and remedies, talk to a lawyer.