What Is the Fair Credit Reporting Act (FCRA)?

The Fair Credit Reporting Act (FCRA) is a federal law regulating the collection of consumers' credit information and access to their 澳洲幸运5官方开奖结果体彩网:credit reports. It was passed in 1970 to address the fairness, accuracy, and privacy of the personal information contained in the files of the 澳洲幸运5官方开奖结果体彩网:credit reporting agencies (CRAs).

How the Fair Credit Reporting Act (FCRA) Works

The Fair Credit Reporting Act is the primary federal law governing the collection and reporting of consumer credit information. Its rules cover how a consumer's credit information is obtained, how long it is kept, and how it is shared with others, including consumers themselves.

The 澳洲幸运5官方开奖结果体彩网:Federal Trade Commission (FTC) and the 澳洲幸运5官方开奖ꦡ结果体彩网:ꦜConsumer Financial Protection Bureau (CFPB) are the two federal agencies that oversee and enforce the law. Many states also have their own laws relating to credit reporting. The FCRA in its entirety can be found in .

The three major credit reporting bureaus—Equifax, Experian, and TransUnion—as well as other, more specialized companies, collect and sell information on individual consumers' financial history. The information in their reports is also used to compute consumers' 澳洲幸运5官方开奖结果体彩网:credit scores, which can affect, for example, the 澳洲幸运5官方开奖结果体彩网:interest rate they'll have to pay to borr꧂ow ꩵmoney or whether they can qualify for a loan.

What Credit Bureaus Can and Can't Do Under the Law

The Fair Credit Reporting Act describes the kind of data credit bureaus can collect. This includes the person's bill payment history, past loans, and current debts. It may also include employment information, present and previous addresses, whether they have ever filed for 澳洲幸运5官方开奖结果体彩网:bankruptcy or owe child support, and any arrest record within the last seven years (or until the governing statute of limitations has expired—whichever is longer).

The FCRA also limits who is allowed to see a credit report and under what circumstances. For example, lenders may request a report when someone applies for a mortgage, car loan, or another type of credit. Insurance companies may also view consumers' credit reports when they apply for a policy. The government may request it in response to a court order or federal grand jury subpoena, or if the person is applying for certain types of government-issued licenses.

In some, but not all, instances, consumers must have initiated a transaction or agreed in writing before the credit bureau can release their report. For example, employers can request a job applicant's credit report, but only with the applicant's permission.

However, some potential lenders and insurers can access portions of your credit report without your permission in order to decide whether to send you unsolicited offers for credit or insurance. This process is called prescreening, and the law allows you to opt out of it by phone at 1-888-5-OPTOUT (1-888-567-8688) or online at .

Consumer Rights Under the FCRA

Consumers also have a right to see their credit reports. By law, they are entitled to at least one free credit report every 12 months from each of the three major bureaus. They can request their reports at the official, government-authorized website: . Note that AnnualCreditReport.com currently provides weekly free credit reports for those who request them.

澳洲幸运5官方开奖结果体彩网: Under the FCRA, consumers also have a rig🦄ht to:

• Verify the accuracy of their report when it's required for employment purposes
• Receive notification if information in their file has been used against them in applying for credit or other transactions
• Dispute—and have the bureau correct the information in their report that is incomplete or inaccurate
• Remove outdated, negative information after seven years in most cases, or 10 in the case of some bankruptcies

If the credit bureau fails to respond to ꦡtheir request ෴satisfactorily, the person can with the CFPB.

Example of the FCRA in Action

Say that someone is looking to rent an apartment and the landlord denies their application, claiming it is because of their credit report or credit score. The potential tenant believes this to be a lie, suspe🔯cting that it is because of their skin color or religion instead, which is an un🌞lawful reason to deny the lease.

Under the FCRA, they can request their credit report and check whether the information in it aligns with the landlord's claims. They can also see if the landlord actually pulled their credit report or lied about doing so. If a violation did occur, the landlord could be fined.

Frequently Asked Questions (FAQs)

The Bottom Line

The Fair Credit Reporting Act (FCRA) governs what credit bureaus can and can't do with the information they collect on you. It also gives you specific rights as a consumer. Because the information in your credit reports is important in many ways, it's worth checking them periodically for any errors, which you can then ask the bureaus to correct. Under the FCRA, you are entitled to free copies of your credit reports at least once a year.