The Fair Credit Reporting Act Guarantees You a Number of Different Rights and Protections
The fair credit reporting act grants several rights and protections to American consumers
You might already know that you have a right to a free annual credit report from each of the three major credit bureaus. But a federal law, the Fair Credit Reporting Act gives you additional rights and protections. The North Carolina Consumers Council helped to pass this federal law as a consumer protection.
Free Credit Reports
As we've already mentioned, the Fair Credit Reporting Act gives you the right to one free annual credit report from Experian, TransUnion, and Equifax for any reason. You are also entitled to a free credit report in any of the following situations:
- Your identity has been stolen and you have put a fraud alert on your credit file.
- Information on your credit report has led someone, such as a lender, to deny your application for credit.
- You are currently unemployed but are planning to apply for work at some point within the next two months.
- You receive public assistance.
Under the Fair Credit Reporting Act, you have the right to dispute inaccurate and erroneous information on your credit reports. When a Credit Reporting bureau receives your dispute, it has thirty (30) days, and 45 (forty-five) days in certain circumstances to investigate the item or items. When it completes the investigation, the item being disputed must be either verified as accurate, corrected, or deleted from the report. If the item cannot be verified within the time limit, it must temporarily remove the item until the investigation is completed. Further, the agency has to tell you the results of the investigation regardless of the accuracy.
Protecting Your Credit Card Numbers
The Fair Credit Reporting Act requires that credit card receipts only list shortened account numbers to prevent the information from being stolen. This is why several account numbers are replaced by other characters on the receipt.
Who Can Access Your Credit ReportsCredit
The Fair Credit Reporting Act determines who is allowed to access your reports. Access can be granted to other parties under these circumstances:
- You are allowed to access your own reports as often as you want, though you may be charged a fee if you have already requested your free report for the current year.
- Your reports may be accessed by third parties if you apply for a loan, credit card, or new insurance policy.
- Your report may be accessed if a court order has been issued.
- Employers can request your credit reports as part of their screening process, but only if you provide written consent.
- If you have an account with a creditor, the account provider can access your reports as part of the process of managing your account.
Pre-Approved to Opt Out
The Fair Credit Reporting Act allows you to opt of our receiving pre-approved credit card offers in the mail. If you don't want to receive these offers, you can opt-out on the Opt Out Prescreen Website. It's completely free.
Time limits for negative items
The Fair Credit Reporting Act sets strict limits for how long negative information can stay on your credit reports. Although there are a few negative items that can stay on your report forever, such as unpaid tax liens and federal student loans, most negative items have to be removed after seven (7) to ten (10) years.
Damages if your rights are violated
If your rights under the Fair Credit Reporting Act are violated, you may be entitled to collect:
- Actual or statutory damages;
- Attorney's fees;
- Court costs; and
- Punitive damages if the violation was willful.