Your Rights Under the Fair Credit Reporting Act (FCRA)
Understand your legal rights under the FCRA and how to use them to protect your credit and dispute errors.
The Fair Credit Reporting Act (FCRA) is a federal law that regulates how consumer reporting agencies collect, use, and share your credit information. Understanding your rights under this law empowers you to take control of your credit report and hold credit bureaus and creditors accountable for inaccurate reporting.
Overview of the FCRA
Enacted in 1970 and significantly amended over the years, the FCRA establishes the rules that credit bureaus (Experian, Equifax, and TransUnion), creditors, and other entities must follow when dealing with your credit information. The law is enforced by the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC).
Your Key Rights Under the FCRA
Right to Access Your Credit Report
You have the right to know what is in your credit file. Under the FCRA, you are entitled to one free credit report from each of the three major credit bureaus every 12 months through AnnualCreditReport.com. You are also entitled to additional free reports if you have been denied credit, are unemployed and looking for work, receive public assistance, or believe your file contains errors due to fraud.
Right to Know Your Credit Score
If a lender uses your credit score to make a lending decision, you have the right to know what that score was. Additionally, if you are denied credit or given less favorable terms based on your credit score, the lender must tell you the score and explain the factors that affected it.
Right to Dispute Inaccurate Information
One of the most powerful rights under the FCRA is the right to dispute any information in your credit report that you believe is inaccurate, incomplete, or unverifiable. When you file a dispute, the credit bureau must:
- Investigate your dispute within 30 days (45 days if you provide additional information)
- Forward your dispute to the creditor that reported the information
- Consider all relevant information you provide
- Remove or correct any information that cannot be verified
- Provide you with written results of the investigation
- Give you a free copy of your credit report if changes were made
Right to Have Outdated Information Removed
The FCRA limits how long negative information can remain on your credit report. Most negative items must be removed after seven years, while bankruptcies can remain for up to ten years. Credit bureaus are required to remove information that has exceeded these time limits.
Right to Limit Access to Your Report
Not just anyone can access your credit report. Under the FCRA, access is limited to those with a permissible purpose, such as creditors considering you for credit, employers (with your consent), landlords, and insurance companies. You have the right to know who has accessed your report by reviewing the inquiries section.
Right to Consent for Employment Checks
Employers cannot check your credit report without your written consent. If an employer decides not to hire you based on information in your credit report, they must provide you with a copy of the report and a summary of your FCRA rights before taking adverse action.
Right to Place a Security Freeze
You have the right to place a security freeze on your credit file, which prevents new creditors from accessing your report. This helps protect against identity theft by making it difficult for criminals to open new accounts in your name. Under federal law, placing and lifting freezes must be free of charge.
Right to Sue for Violations
If a credit bureau or creditor violates the FCRA, you have the right to sue in state or federal court. You may be entitled to actual damages, statutory damages (up to $1,000 for willful violations), punitive damages, and attorney fees.
How to Exercise Your Rights
To effectively use your FCRA rights:
- Review your reports regularly: Check all three credit reports at least annually
- Document everything: Keep copies of all correspondence with credit bureaus and creditors
- Dispute in writing: Send dispute letters via certified mail with return receipt requested
- Be specific: Clearly identify the information you are disputing and explain why
- Include documentation: Provide any supporting evidence for your dispute
- Follow up: If you do not receive a response within 30 days, follow up in writing
Professional Help With FCRA Disputes
While you can exercise your FCRA rights on your own, many consumers find that working with a professional credit repair service produces better results. At The Credit Repair Guy, we understand the nuances of the FCRA and how to craft effective disputes that get results. Contact us for a free consultation to learn how we can help you exercise your rights and improve your credit.