How the Fair Credit Reporting Act Protects You and Your Credit Score

The Fair Credit Reporting Act was enacted by the Federal Trade Commission in 1970 to protect consumers in regards to their credit report.  You have certain rights enumerated in this act and, according to this law, you are entitled to seek reparations if any of these rights are violated.  But you can’t do that if you don’t know what these rights are.

For one thing, you can know what the report says.  Under many circumstances, you can find out for free, including one time every twelve months.  You can also ask for the actual numeric score, but that might cost you some money.

If you see that there is something incorrect on your credit report, you are allowed to dispute it.  Furthermore, if the information is proved to be inaccurate, or cannot be verified, the reporting agency must remove or correct it within thirty days if possible.  Also, any negative information that is older than a certain number of years (the number depends on what type of information it is) cannot be reported.

Besides you, only people who need the report are allowed to see it, such as employers, potential lenders, or landlords.  If the person is an employer, they must have your written permission to see it.  You can also choose not to allow credit card companies or insurance companies to see it for purposes of preapproval or your solicitation.

Finally, if an employer, potential lender, potential landlord, or other person with access to your credit report chooses to deny whatever you have requested based on any information they find they in it, they have to inform you that this was the reason for the decision.  In fact, if this information is used against you in any manner, they must inform you of it.

If you have any problem with someone violating these rights, you should take action.  In this case, you would have the right to sue the violating party in either a federal or state court.

Also, you should be aware that you have additional rights if you work for the United States military or become a victim of identity theft.

Your credit report is extremely important.  These rights are meant to protect it (and you), but you should also take care of it by being aware of what it says and using credit responsibly.


Note: Effective July 2011, borrowers who are approved but are charged a higher rate must receive either a free FICO score or a risk-based pricing notice to explain why they are being charged additional interest.

Kari Johnson

Kari Johnson is a first-year student at the University of North Carolina at Chapel Hill, having lived in North Carolina her whole life. At UNC, she is a declared Religious Studies major, and intends to study some form of writing as well during her time and Chapel Hill. She plans to graduate in 2014, after participating in undergraduate research and a study abroad program.

Kari discovered the magic of writing early, in elementary school, and has devoted every spare moment to it since. She writes fiction for her own amusement, and recently began writing articles for The Daily Tar Heel in Chapel Hill. Besides writing, she loves spending time with friends and family, reading, and drinking coffee. She defines herself based on her faith in God, her family roots, and her dream of one day publishing a best-selling novel.

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