Credit reporting is huge industry in the United States. Credit reports are utilized for their initial and fair reason of evaluating the creditworthiness of an individual to borrow money and now they are also being used for such things as insurance underwriting and employment. As of right now it is fully legal to be denied employment or insurance based upon your credit report.
Credit reporting agencies gather, assemble and sell credit information on consumers. There are three major credit-reporting bureaus in the United States. They are Experian, Equifax and TransUnion.
The Federal Credit Reporting Act protects consumers from undue, incomplete and erroneous reporting on a credit report. Under this law a consumer has the right to dispute and challenge any information on a credit report that is inaccurate, incomplete or erroneous in any way. As a consumer you have the option to issue a dispute to the credit companies. After receiving of your dispute letter they will have 30 days in which to either authenticate the accuracy of their coverage or to erase it from your credit report.
The Federal Credit Reporting Act also provides consumers the right to get one free credit report from each credit-reporting bureau one time per year. The consumer just needs to put in a request. You also have the right to receive a report if credit is denied because of what is contained on the credit report. The credit bureau that is reporting the problematic information must offer the consumer a credit report so that the consumer knows exactly why they were denied credit.
Oftentimes derogatory credit listings are deleted from credit reports after a dispute because the credit bureaus were unable to authenticate the correctness within the time period. If information is removed the credit bureaus can’t reinstate the listing without notifying the consumer in writing.
The Federal Credit Reporting Act also governs the amount of time that poor information can remain on a credit report. A listing cannot stay longer than 7 years following the delinquency for most items, however, a bankruptcy can stay on the report for 10 years and a tax lien for 7 years after it has been satisfied.
It is well worth a consumers time to take advantage of the rights offered by the Federal Credit Reporting Act because it is predicted that as many as 40% of all disputed information is not accurately proven within the time limit. Consumers should be conscious, though, that all correct and truthful information should not be disputed but should remain on the credit report.
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