There are several pieces of legislation in the
credit reporting industry that protect consumers from having their credit
ruined by bad business practices or bad credit reports. Because credit plays
such an integral part in modern society, you should know about these laws so
you can understand your rights and how to protect yourself.
FAIR CREDIT REPORTING ACT
Credit Reporting Act (FCRA) is a federal law that is designed to
regulate credit reporting agencies. Furthermore, fair credit reporting compels
the consumer reporting agencies to ensure
that the information they are gathering and distributing is a fair and accurate
summary of a consumer’s credit history. The FCRA includes a list of consumer
rights regarding an individuals’ credit history.
Access to Your Credit Score
The act requires credit reporting agencies to
provide a consumer with any information in their annual credit file when
requested once a year. You will need proper identification to gain access to
this information, but you are allowed to request
one free copy of your FICO score, and you
should receive it within 15 days of your request.
The act limits who has access to your credit file. These
entities include banks, insurance companies, employers, and others doing
business with you that requires credit. When you request your free credit
report and credit scores every year, you also have the right to know who asked for your credit report during the last
year, or if you want to see employer-related requests, two years.
You have the right to challenge incorrect
information on your credit report with the credit bureau. If the wrong information cannot be verified, the reporting companies have the
responsibility to remove it. If you find that you aren’t able to clear up the
problem, you have the right to add a statement to your credit report explaining
the situation about your credit accounts.
Protect Your Account Numbers
The FCRA prohibits a business from publishing your full credit card number on any
receipts. The law also allows you to protect your Social Security number by
having it shortened on your credit report.
Again, there are many more rights that the FCRA gives to consumers, all of which
you should be familiar with when trying to figure out what credit reporting
legislation affects you.
FAIR DEBT COLLECTION PRACTICES ACT
Debt Collection Practices Act (FDCPA) is a law that is designed to
limit the actions and behavior of debt collectors, especially those who are
trying to gather debts for another company or person. In particular, this law limits the means and methods that debt
collectors can use to contact debtors, the number
of times they can contact debtors, and even when
they can contact them.
When can debt collectors contact debtors?
According to the FDCPA, debt collectors are not
allowed to contact debtors at inopportune times-meaning that they are not allowed the ability to interact with debtors before 8 a.m. or after
9 p.m. unless a call has been arranged with the debtor out of those
Where can debt collectors call debtors?
Debt collection agencies can reach out to debtors
at their home or offices, but if a collector is told by the debtor, either in
writing or verbally, to stop calling their place of work, the collector cannot call their office again. Debtors can also
request that collectors stop calling their home, but that must be in writing.
What can a collector do?
Debt collectors only have the authority to inform a
debtor about the debt in question and ask for payment. There are some cases
where the collector can help figure out a payment plan or settlement to help the debtor pay the bill.
Fair Credit Billing Act
Credit Billing Act (FCBA) is an amendment to the Truth in Lending
Act and allows credit cardholders to dispute incorrect charges and even
temporarily withhold payment–all without hurting their credit reports. Under
this law, credit card companies must also look into any charges the consumer
disputes and if they find that the charges are wrong, then the information must
be corrected on the consumer’s credit file immediately.
Consumers are also protected
from liability and fraudulent charges under the FCBA if their credit card
information has been stolen or left vulnerable during a data breach. You have
60 days after the bill was mailed to you to dispute a charge on your credit
- You must
mail in your dispute. In this letter, include your
name, account number, the dollar amount you are disputing, and why you think
it’s a mistake. Send the letter by
certified mail and include documentation.
- The investigation will take a few months to complete–so be
patient. However, they only have 30 days to acknowledge your dispute and inform
you of their investigation.
- You can dispute the findings of an investigation if you
disagree with the result
- If your card was
lost, stolen, or had fraudulent uses, you need to call the agency directly
instead of writing to them
- If you are dissatisfied with a credit card purchase, you
can temporarily withhold payment until the complaint is resolved
- If you feel as though your rights are being ignored, you have every right to contact
Truth in Lending Act
The Truth in
Lending Act (TILA) was designed to ensure that consumers are treated
fairly by all businesses in the marketplace and are informed about the true cost of credit. The TILA also requires
credit lenders to disclose all credit terms in an easy to understand manner so
that consumers can confidently compare interest
rates and conditions with other cards.
Credit Repair Organization Act
Repair Organization Act (CROA) allows you to correct any mistakes
and errors that might appear on your credit report. This act protects your
rights to legitimate, reputable credit repair services to help you protect your
There are two reasons that
CROA was established:
- It’s in the best interest of any consumer to maintain the
highest credit scores possible, so if any consumer experiences a problem, they should have the right to act by
fixing any mistakes.
- Certain companies make false or misleading claims in an advertisement or engage in bad business practices that could harm
consumers who are already struggling.
CROA had two main purposes for
- To ensure that consumers who want to use credit repair
services are fully informed about their rights before they make any purchasing
- To protect consumers from unfair and deceptive advertising
and business practices.
Now that you have a better
understanding on your rights as a consumer and how credit reporting legislation
affects you, you are better prepared to tackle your credit and build a more
positive credit history with the reporting agencies.
If you’re looking for an
organization that lives up to the highest ethical standards and adheres to all
applicable statutes, rules, and regulations, then you should look at Lexington Law Firm.
We offer a high level of
expertise to ensure that your credit report repair will be designed for your
specific situation and will act on your behalf when it comes to dealing with
credit reporting bureaus and creditors.
At Lexington Law Firm, the
attorneys believe creditors should have to prove items on a consumer’s credit
report are accurate, fair, and adequately authenticated. Receive a free
personalized credit consultation from Lexington Law and let an attorney walk
you through their service levels to find the right credit repair solution to
fit your credit needs.