Business & Finance Personal Finance

About the Fair Credit Reporting Act

    History

    • The Fair Credit Reporting Act was originally passed in 1970. Congress passed this bill to protect the consumer by requiring credit bureaus such as Equifax and TransUnion to provide the complete and correct information when requested by companies.

    Significance

    • Credit reports must be complete and accurate because they are used by the consumer to obtain loans, insurance, credit cards and in some cases, employment. Without the Fair Credit Reporting Act, credit bureaus could possibly supply wrong information about the consumer, preventing him from getting credit, insurance or a job.

    Function

    • The Fair Credit Reporting Act outlines the responsibilities of credit reporting companies. If you find a discrepancy on your credit report, the Fair Credit Reporting Act provides you with a way to correct those discrepancies.

    Time Frame

    • The Fair Credit Reporting Act provides certain time frames for actions to be taken by credit reporting companies. Once a dispute has been filed, the credit reporting companies must respond within a certain amount of time, or else they will have to remove the erroneous information. It also dictates how long a bad debt may be published on your credit report.

    Geography

    • The Fair Credit Reporting Act and the Fair Debt Collection Practices Act are part of federal law. The federal government has jurisdiction over any claims filed under these acts, which means that claims may be filed in any of the United States district courts in any state.

    Effects

    • If a creditor is harassing you, you need to find out if he is out of line according to the Fair Credit Reporting Act and the Fair Debt Collection Practices Act. If he is, you can request that he cease and desist under one or both of these acts. If the creditor does not cease, he may be breaking a federal law, opening the way for you to file a lawsuit against that company. All consumers should be familiar with both acts, even if he does not have debt collections, as the acts can help with correcting credit reports, increasing your credit score.

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