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The Fair Credit Reporting Act (FCRA)
Below is a summary of the FCRA. The full Act can be
obtained directly from the Federal Trade Commission's web site here.
Fair Credit Reporting Act (Summary)
Public Law 91-508
The Fair Credit Reporting Act (FCRA) allows a consumer to challenge the
information on his credit report on the basis of "completeness and
accuracy." If, after a reinvestigation by the credit bureau, the disputed
information "is found to be inaccurate or can no longer be verified, the
[credit bureau] shall promptly delete such information."
The credit bureaus are required to complete the investigation within a
"reasonable period of time." This period has been set at thirty days.
The credit bureaus can ignore the consumer dispute if they have reason to
believe that the dispute is "frivolous or irrelevant." The FTC commentary on
the FCRA cites, as an example of a frivolous dispute, a dispute wherein the
consumer challenges all negative items on his credit report without
providing any allegations regarding specific items in the credit file.
However, "A [credit bureau] must assume a consumer's dispute is bona fide,
unless there is clear and convincing evidence to the contrary."
When a consumer challenges a negative credit listing on the basis of
extenuating circumstances, such as health problems, divorce, job loss, etc.,
the credit bureaus are entitled to ignore that dispute.
When a consumer submits a dispute which is neither frivolous nor irrelevant
by credit bureau standards, the credit bureau must "at a minimum... check
with the original sources or other reliable sources of the disputed
information and inform them of the nature of the consumer's dispute." In
some cases of consumer dispute, "Reinvestigation and verification may
require more than asking the original source of the disputed information the
same question and receiving the same answer."
In other words, when a consumer files or re-files a valid dispute, the
credit bureaus must contact the source of the credit information (the
creditor) and confirm that the information is accurate, verifiable, and not
obsolete. In some circumstances, the credit bureau is required to go beyond
a simple verification of the creditor's own computer record. If, within 30
days, the credit bureau has not received verification from the creditor,
then the credit bureau must promptly delete the credit listing.
In theory and law, the process is deceptively simple, thus leading many
people to think that they can easily handle this themselves "for the price
of a few postage stamps." Most quickly discover that the credit bureaus have
made it much more difficult than one would imagine. For help in this, we
recommend using
Lexington Law
a professional credit report repair company.
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