What is included on your credit report can impact your finances in a number of different ways. A credit score can affect your ability to get a mortgage, a favorable interest rate on a credit card, housing, and even a job. It is crucial that you are properly protected against errors on your credit file. The Fair Credit Reporting Act (FCRA) is the most important federal law for addressing inaccurate/outdated information on your credit report. At The Kim Law Firm, LLC, we help people navigate FCRA cases. Our team wants to ensure that you know your rights. Here, our credit report error lawyer highlights the top ten rights that consumers have under the FCRA.
- You Have the Right to Know What is in Your Credit File
First and foremost, it is important to emphasize that you have a right to know what is actually in your credit file. That information, which is about you, should not be kept secret from you. In practice, you can request a copy of your credit report to check for accuracy, outdated accounts, or fraudulent activity. Everyone is entitled to at least one free credit report per year from each of the major bureaus. You can get it from Annualcreditreport.com.
Under the FCRA, consumer reporting agencies must provide a full disclosure of all information in your file upon request. Among other things, this includes the sources of the information, a list of everyone who obtained your report within the past year, the past two years for employment purposes, and the identification of any third-party users. Notably, the disclosures that are provided should be clear and understandable.
- You Have the Right to Limit Access to Your Credit Report
Credit reports are not “open” access. Quite the contrary, they are sensitive, restricted information. Not just anyone can look at your credit report. You have the right to control who sees your credit information, and it can only be shared for certain permissible purposes. Some examples include applying for a loan or renting an apartment.
The FCRA restricts access to your credit file to those with a legitimate need. Some of the most common permissible purposes include credit transactions, employment (with your consent), insurance underwriting, and government licensing. Unauthorized access is a violation of the law. If someone views your report without a valid reason, you may have an FCRA claim.
- You Have the Right to Require Consent Before Your File is Shared With an Employer
It is not uncommon for employers to run background checks. Many employment background checks will include a “pull” of the credit report for the job applicant/employee. Employers cannot simply decide they want to check out someone’s credit history. If an employer wants to check your credit report, they cannot do it without your knowledge. You must give written permission first.
The FCRA—specifically 15 U.S. Code § 1681b(b)(2)—holds that employers must obtain clear and conspicuous written authorization from a person before accessing a consumer report for employment purposes. Notably, they must also provide a standalone disclosure that a credit report may be used in making employment decisions. The failure to do so is a violation.
- You Have the Right to Opt Out of Pre-Screened Offers
Most people get a lot of “prescreened” offers for credit cards, loans, and insurance coverage in the mail. Some consumers like them, some are neutral, and some hate them. A key thing to know about your rights under the FCRA is that you do not have to receive any prescreened offers. You can choose to stop them. These offers are based on your credit report. If you do not want companies using your data this way, you can opt out—either for five years or permanently.
Under the FCRA, consumer reporting agencies may provide your file information for pre-screened credit or insurance offers only under strict conditions. However, you have the right to opt out of this practice under 15 U.S. Code § 1681e(d)(2). There is an official phone number that you can call to start the “opt-out” process for prescreened offers. It is 1-888-5-OPTOUT (1-888-567-8688).
- You Have the Right to Obtain a Security Freeze On Your Credit File
A credit freeze is a very important option for consumers to protect themselves against identity theft and other types of fraud. You can lock your credit file so no one can open a new account in your name without your direct approval. A credit freeze can be especially helpful if you are worried about identity theft or fraud. The credit freeze can be lifted at any point in time.
Under the FCRA, all nationwide consumer reporting agencies must allow consumers to place a security freeze on their credit files at no cost. A freeze prevents the agency from disclosing your report to new creditors without your express authorization. With that being said, it does not stop access for existing creditors, collection purposes, or certain government uses.
Note: A credit security freeze will not affect your credit score.
- You Have the Right to Be Told if Information is Being Used Against You
The information that is on your credit report could be used against you in a number of different ways. That is why it is so important that any errors are corrected as soon as possible. If your credit report is used to deny you a loan, job, insurance, or anything else important, you have the right to be informed. Companies must tell you if negative information from a credit report influenced their decision in any manner. If you know what happened, you can take action to fix any problems.
The FCRA holds that when adverse action is taken based on a consumer report, the party responsible must provide a notice that includes: 1) the name, 2) the address, 3) the phone number of the credit reporting agency, 4) a statement that the agency did not make the decision, 5) and a notice of your right to dispute inaccurate information. The notice helps to ensure you can promptly review and, if needed, correct your credit file.
- You Have the Right to Dispute Incomplete or Inaccurate Information
What happens if you proactively discover that there is incomplete, inaccurate, or otherwise misleading problematic information on your credit report? The short answer is that you have the right to dispute that negative information. Indeed, if you spot something wrong on your credit report—like an account you did not open, a balance that is incorrect, or a note that falsely says payments were late—you can challenge it. The credit bureau is required to investigate and fix the mistake if it cannot be verified. You do not have to accept errors that hurt your credit.
These are time-sensitive cases. Under the FCRA, all three of the major credit reporting agencies—Experian, TransUnion, and Equifax—must investigate disputes submitted by consumers within 30 days of receiving a notice. If the item cannot be verified, it must be deleted or otherwise corrected. The agency must also notify the furnisher of the dispute and provide any relevant information you submitted. After the investigation, the credit reporting agency in question must provide you with the results in writing. They must also provide a free updated copy of your report if they made any changes to your credit file.
- You Have the Right to Be Protected Against Outdated Information
Every consumer has the opportunity to rebuild their credit. Indeed, negative marks on your credit report do not last forever. Most debts, missed payments, and other derogatory information must come off your report after a certain number of years. Even a personal bankruptcy will “fall off” of your credit report in either seven years or 10 years, depending on whether it is a Chapter 7 or Chapter 13. You have the right to a report that reflects only timely, relevant credit history.
The FCRA requires that information furnishers only provide information that is timely under the law. For most circumstances, that is seven years. That certain adverse information, most notably, a Chapter 7 bankruptcy filing, will remain on your credit report for ten years. If you have outdated information on your credit report, you have the right to challenge it and to fight to get it removed under the Fair Credit Reporting Act.
- You Have the Right to Seek a Correction of Problems on Your Credit Report
You can take action if something goes wrong with your credit report. Whether it is an error by the credit bureau or incorrect data from a creditor, you have the right to get it fixed. It is your file, and the law gives you the tools to correct it. Indeed, this is one of the most powerful tools that consumers have to fight back against big businesses, aggressive debt collectors, and the major credit bureaus. You can and should file a written request to have any inaccurate, outdated, or otherwise improper information removed from your credit file.
Under the FCRA, both credit bureaus and data furnishers—such as lenders and third-party debt collectors—have the legal responsibility to investigate and respond when notified of a dispute. Furnishers must review all relevant information, correct inaccuracies, and update all credit bureaus where the data was reported. If they fail to meet these obligations, they may be held liable for negligent or willful noncompliance. You also have the right to file a statement of dispute directly in your file.
- You Have the Right to Seek Damages for an FCRA Violation
What happens if you dispute incorrect negative information in your credit report, but no timely action is taken to fix the issue? The short answer is that you have the right to file a legal claim, potentially including an FCRA lawsuit, to seek financial compensation for your damages. Indeed, if your rights under the FCRA are violated, you do not have to just accept it—you can seek justice. Whether it is an unauthorized disclosure, a refusal to correct errors, or a failure to notify you of adverse action, you may be entitled to financial compensation.
The FCRA provides for both statutory and actual damages. The specific amount of damages that can be recovered in any specific case will depend on the nature of the violation. Under 15 U.S. Code § 1681n, a consumer may recover between $100 and $1,000 for willful violations. They may also potentially be entitled to recover attorneys’ fees, legal costs, and, in some cases, even punitive damages. For negligent (non-willful) violations of the FCRA, a consumer may still recover actual damages and their legal costs. The right to sue gives consumers meaningful enforcement power.
Why Consumers Trust Richard H. Kim for Credit Report Error Cases
Dealing with an error on your credit report can be stressful and frustrating, especially if the credit report error is costing you money, housing, or an employment opportunity. It is imperative that you take immediate action to correct the problem. Creditors, third-party debt collectors, and credit reporting agencies can all be held liable for FCRA violations. As a top-rated credit report error attorney, Richard H. Kim is a strong, experienced advocate for justice. We provide proactive, solutions-focused guidance and support to consumers. When you reach out to our law office, you will have an opportunity to consult with a credit report error attorney who is prepared to:
- Conduct a comprehensive review and evaluation of your case;
- Investigate your credit report error and explain your legal options;
- Help you gather and organize all supporting financial documents and records; and
- Take whatever legal action is needed to help you fix the problem and claim damages.
Contact Our Credit Report Error Attorney Today
At The Kim Law Firm, LLC, our credit report error attorney fights for justice for people and families who have been victimized by big businesses, including lenders, debt collectors, and credit reporting agencies. If you have any specific questions about your rights or your options under the FCRA, we are here to help. Contact us today to set up a completely confidential, no-obligation initial consultation. With an office in Philadelphia, we can handle FCRA cases nationwide.
