1) What is a consumer reporting agency?
2) What is a credit bureau?
3) What is a consumer report?
4) What is included in a consumer report?
5) What is not included in a consumer credit report?
6) Who may access credit information?
7) What laws regulate credit reporting?
8) How long does negative information remain in a credit file?
9) How can a consumer correct an error?
10) Can a consumer's credit be improved by paying a company?
11) Where can a consumer receive credit advice?
12) Does a divorce decree relieve a consumer from liability of debt?
13) Does a credit reporting agency or credit bureau grant credit?

     

1) What is a consumer reporting agency?
A consumer reporting agency is a company that regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports. Back to top

2) What is a credit bureau?
A credit bureau is a company that collects, updates, stores and sells credit and other information about an individual. Creditors provide credit information to the credit bureaus. The credit bureaus also obtain public records information. There are three major credit bureaus in the United States: Equifax, Experian and TransUnion.        Back to top

3) What is a consumer report?
In general: The term "consumer report" means any written, oral or other communication of any information by a consumer reporting agency bearing on a consumer's credit worthiness, credit standing, credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected in whole or in part for the purpose of serving as a factor in establishing the consumer's eligibility for (A) credit; or insurance to be used primarily for personal, family, or household purposes; (B) employment purposes; or (C) any other purpose authorized under Section 604 of the Fair Credit Reporting Act. A consumer report is a snapshot of how an individual has paid back creditors, as well as, performance on other financial obligations.  Back to top

4) What is included in a consumer report?
A consumer credit report may contain the following:

    Identification Information
      Includes; name(s), previous and present addresses, social security number, previous and present employment information.
    Creditor Information
      Includes; Account information provided by credit card companies, banks, savings and loan companies, student loan and mortgage companies and other credit grantors. The information includes date opened, date of last activity, credit limit, balance, past due amount, individual or joint account, number of times payments have been past due.
    Public record Information
      Includes; bankruptcy records, tax liens and judgments. This information is collected from public record sources.

    Inquiry Information

      Includes; the names of those who have received credit history. If a consumer applies for a credit account, companies will inquiry into the consumers credit history. An inquiry may show on the consumer report for up to two years.  Back to top

5) What is not included in a consumer report?
A consumer report does not include medical history, race, religion, personal lifestyle, political affiliation, national origin, checking or savings accounts or information unrelated to credit.  Back to top

6) Who may access credit information?
The Fair Credit Reporting Act regulates who may access a consumer's credit information. In general, a consumer reporting agency may furnish a consumer report in connection with credit extension, review or collection, for employment purposes, eligibility for a license, underwriting of insurance or otherwise legitimate business need. Consumers may also access their own credit report.  Back to top

7) What laws regulate credit reporting?
The Fair Credit Reporting Act (FCRA) is the federal law regulating consumer reporting agencies. The FCRA was originally passed into law in 1971. An amended FCRA went into effect October 01, 1997 with additional amendments passed in 1998. The FCRA regulates who has access to credit information and the penalties for violation. It requires that the consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner that which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information.   Back to top

8) How long does negative, but accurate information remain in a credit file?
Negative information remains on a consumer's report for seven years. Chapter 13 bankruptcies remain on file for seven years from date of filing. Chapter 7, 11 and 12 bankruptcies remain on file for ten years from date filing. Positive information may remain on file indefinitely.  Back to top

9) How can a consumer correct an error?
After a consumer has received a copy of the consumer report, the consumer may contact the report provider. The report provider will reverify the item(s) in question. The dispute process may take up to 30 days. If, after the reinvestigation the consumer still disputes the error, a statement may be added to the file.              Back to top

10) Can a consumer's credit be improved by paying a company?
Consumers can do for themselves what credit repair companies do for a fee. Consumers can dispute information on their consumer report with the report provider. If the information is incorrect, the negative information must be removed from the report. If the information is confirmed, the negative information may remain on the report until the statute of limitations expires. The Federal Trade Commission (FTC) has additional information concerning this topic.  Back to top

11) Where can a consumer receive credit advice?
Consumer Credit Counseling Service is a national, non-profit organization that offers consumers assistance with financial concerns. They offer financial counseling and debt management planning for little or no cost. Counselors analyze a consumer's current income, debt and spending habits and work with creditors to develop a debt repayment plan and establish a budget for the future. For the nearest office contact:

12) Does a divorce decree relieve a consumer from liability of debt?
A divorce decree does not relieve a consumer from liability for joint account debts or family bills of necessity incurred during the marriage. Both persons listed on a joint account are legally responsible for paying back the debt. The credit grantor may contact either or both parties to collect the debt.  Back to top

13) Does a consumer reporting agency or credit bureau grant credit?
Neither credit bureaus nor consumer reporting agencies grant credit to consumers. They simply report information to credit grantors, who make the credit decisions.  Back to top

 

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