The Fair Credit Reporting Act

The three credit report agencies, Equifax, Experian, and Trans Union can be said to have quite a lot of power, for they hold the information that can make you or break you when it comes to being approved for credit. However, consumers do have something on their side, and that is the Fair Credit Reporting Act.

Not just an act, but also an actual Federal law, the Fair Credit Reporting Act can be the only thing that can be a buffer between the consumer and these credit agencies. It gives you certain rights, which influence how the three agencies are obligated to do their job and also gives them several responsibilities.

Credit reporting agencies must make available to you the information about your credit that they have on file. This is done in the form of a credit report, and you can receive one report per agency per year. You can request your report by phone, via mail, or online.

You must receive information in writing whenever any of the information in your credit file has been used against you. This could be a credit card company, service provider, bank, loan company, landlord or employer. The information also must include which of the three agencies provided the information so that you can contact them if you believe that the information in your report is wrong.

This information will be needed by you if you were applying for credit, because the Fair Credit Reporting Act states that if you are turned down for credit anywhere because of what your credit record says, you will have 60 days in which to request a credit report from that agency at no charge. Many people do not bother, but it is a good idea to get the free report so that you can find out exactly why you were refused credit.

Also, while you are discovering why you were turned down, you can make sure there are no mistakes on the report, or charges listed that you do not remember. This is how many people find out for the first time that they have been the victim of identity theft. They are amazed to receive this type of letter in the first place, thinking that their credit is good. When they investigate, they find out that someone has been using their identity to merrily charge away.

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