The Importance of a Credit Report
A credit report gives a summary of an individual’s credit history, including debt and open credit lines. The report is provided by one or more consumer reporting agencies (CRAs) to potential lenders giving them information to help make decisions on an individual’s financial requests, from car loans to starting a business.
What Is A Credit Report?
In basic terms, a credit report shows the entirety of a consumer’s financial history. And we do mean the entirety; everything from the first credit card to a mortgage appears in detail on the report. Consumer reporting agencies (CRAs) make use of that information to help determine how to proceed with individual consumers. If you’re unfamiliar with CRAs, just think of companies like Equifax, Transunion, and Experian.
What Does That Mean For Me?
Enacted on October 26, 1970, the Fair Credit Reporting Act (FCRA) exists as a countermeasure against inaccurate information being used to damage a consumer’s credit report. But while the FCRA grants protection to consumers, the act does not prevent errors from appearing on a credit report.
Common Report Errors
-When information from one consumer’s file merges with another consumer’s file. Merged files can result in one individual’s credit being tarnished by the other individual’s damaged credit. These are common in cases where the names, addresses, or even just the social security numbers are very similar. One real world example is a friend of mine had a Chapter 7 Bankruptcy show up on his Equifax report, causing him to be turned down for a loan. The case number on the Bankruptcy actually correlated back to a Chapter 7 that had been filed by his father, that my friend was in no way a party to. They did however, have the same first and last name and lived at the same address.
-When one individual illegally acquire the identity of another individual for personal gain, resulting in damage to the victim’s credit report.
-Someone lacking a permissible business purpose to access an individual’s credit rating.
INACCURATE PUBLIC RECORDS
-When a credit report contains outdated or incorrect credit information, such as an ongoing lawsuit that you were in fact victorious on, or a judgment that has since been paid.
STALE OR RE-AGED DEBT
-When creditors alter the date of the last payment to keep the item on a credit report longer than they otherwise should.
What the Dispute Process Looks Like
If an individual discovers an inaccuracy in their credit report, the law gives them the right to dispute that item. Once a dispute gets submitted, the CRAs are required to reinvestigate the issue, which will generally involve communication with the furnisher of that information and require the CRAs to provide the correct information.
Individuals seeking to dispute a report must send a dispute letter, written and submitted by certified mail with a return receipt requested. The individual should include as much information about themselves, such as full social security number and full driver’s license number, and the account in question as possible to ensure accuracy.
Free Consultation Available
Interested parties can get a free copy of their credit report once a year from each of the three CRAs at www.annualcreditreport.com. Contact Foley Law now for a free consultation, including a complimentary credit report review. In some cases, we may be able to help dispute the inaccuracies and, if necessary, discuss the possibility of bringing suit against the CRAs and/or furnishers.