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The Fair Credit Reporting Act (FCRA) is a federal law that helps to ensure the accuracy, fairness and privacy of the information in consumer credit bureau reports.
The act details how a consumer’s credit information can be obtained, how it can be shared, how long it can be stored, and when it must be deleted.
The act is aimed at the three major credit reporting agencies (Equifax, TransUnion, and Experian). It also applies to:
The FCRA was enacted in 1970 and has been amended twice to allow for growing problems such as identity theft, most recently in 2009.
The Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) are the federal agencies that oversee the FCRA. Many states have their own state laws related to credit reporting, enforced at the state level.
The FCRA provides that each of the three credit reporting agencies will give you one free credit report each year. The three agencies must disclose your credit score to you as well, but they are allowed to charge a fee for that.
Additionally, if you are denied on a credit application, you are entitled to the information related to the denial.
Inaccuracies must be corrected or removed. If you found mistakes and reported them to the consumer reporting agency and they cannot verify that the information is in fact correct, they must remove it within 30 days.
You can (and should) dispute credit reporting errors.
Additionally, if you suspect your identity has been stolen, you can temporarily freeze your credit.
Under the FCRA, he only people or companies allowed to access your credit report are those with “permissible purpose.”
Examples of parties with a permissible purpose are fairly broad, including:
Employers or prospective employers must ask for and receive your permission before they may review your credit report.
You are also protected from having medical information in a consumer report, as creditors are prohibited from obtaining or using medical information when making a credit decision.
The FCRA also empowers you to request that you be removed from all unsolicited prescreened offer lists for credit and insurance. To start this process go to optoutprescreen.com or call 1-888-5-OPT-OUT (1-888-567-8688).
The FCRA is the reason why businesses are not permitted to publish full credit card numbers on receipts. It’s also why only a partial Social Security number is included on your credit report.