can have a major impact on your life outside of its ability to enable
you to make purchases. For example, some employers consider your
credit report as one of the factors involved in the hiring process,
so it can affect whether or not you get a particular job. That's
why it's important to understand the value of credit and also to
understand your credit rights if you're treated unfairly.
laws that regulate credit are outlined below.
Credit Reporting Act:
Fair Credit Reporting Act promotes the accuracy and privacy of information
in consumer credit reports. It also controls the use of credit reports
and requires consumer reporting agencies to maintain correct and
other words, you not only have the right to review your credit report,
you also have the right to have any inaccuracies corrected. Highlights
Fair Credit Reporting Act include:
credit report can only be released to someone with a legitimate
business interest such as a creditor, or an employer.
you are denied credit for any reason, the creditor is required
to provide you with the reason why as well as to provide you
with the name and address of the credit bureau that issued the
your credit report has been corrected, you have the right to
have the credit bureau reissue a new credit report to those
creditors who have viewed your credit report within the last
6 months or to employers who have received one in the last 2
Credit Bureau's responsibility to provide you access to your
credit information, as well as providing you with information
regarding who has inquired about your account recently. Beginning
in 2005, everyone will be entitled to 1 free copy of their credit
report. Otherwise, you may obtain a free copy because of the
following reasons: (1) you have recently been denied credit,
(2) you are unemployed and plan on seeking a job within the
next 60 days, (3) you are on welfare, or (4) your report is
inaccurate due to fraud.
may chose to Opt
Out of unsolicited offers from credit issuers and
insurance companies. You may either write or call Equifax,
Experian, and Trans
Union to be removed from these lists. Telephone
requests are valid for 2 years; written requests are permanent.
For telephone requests, call (888) OPT OUT.
Credit Opportunity Act:
Equal Credit Opportunity Act requires that individual creditors
apply credit standards in a fair manner, so that all consumers are
given an equal chance to obtain credit. It does not require all
creditors to have the same standards, nor does it guarantee approval
of loan applications.
other words, creditors are required to apply the same standards
for granting credit to everyone who applies. While they are not
required to use the same standards, they can not refuse to grant
credit based on sex, race, marital status, religion, national origin,
age, income from assistance programs, or if you exercise your rights
under the Consumer Protection Act. Highlights of the
Equal Credit Opportunity Act include:
you are not required to answer, the only time it is permissible
to ask your sex, race, ethnicity, or religious affiliation is
when you are applying for residential real estate. These questions
are allowed to be asked solely to enforce fair
housing laws. Creditors
can ask about your marital status if your spouse will be involved
in securing, using, or will be legally responsible for the loan.
Married couples also have the right to have their credit histories
may be asked about how items such as alimony or child support
affect your income if you plan on using this income to repay the
are not allowed to deny credit because of age (particularly
those who are 62 and over). However, they may ask your age to
be sure that you are of legal age or to estimate how long you
will continue to work.
terms of your credit arrangement cannot be changed when things
in your life change, such as, marriage or retirement
must be notified within 30 days of submission of an application
for credit. If you are denied credit, the creditor must provide
in writing the action taken, the reason for denial, the right's
of an applicant, and the name and address of the reporting credit
agency. If you believe that you have been discriminated against,
you may sue for damages up to $10,000.
Credit Billing Act:
Credit Billing Act provides for the prompt correction of errors
on open-end credit accounts (department store credit accounts, for
example) and protects consumers' credit ratings while they are settling
law dictates that a creditor cannot report a consumer's
account as delinquent when they are disputing a charge. It is the
responsibility of the consumer to report, in writing, a disputed
item to the creditor within 60 days of receiving the bill. The creditor
must respond within 30 days.
Debt Collection Practices Act:
Fair Debt Collection Practices Act promotes the fair treatment of
consumers by prohibiting debt collectors from using unfair, deceptive,
or abusive practices.
this act is directed toward professional debt collectors and does
not specifically apply to banks, department stores, and other lenders
who collect their own debts, no one is allowed to use unfair,
deceptive, or abusive practices. Highlights of the
Fair Debt Collection Practices Act include:
only reason a debt collector can contact someone other than
the debtor is to make a reasonable effort to communicate with
or to locate the debtor.
debtor, once located, must be notified in writing of the amount
of the debt, the name of the creditor, and the fact that the
debtor has 30 days to dispute the notice, otherwise, the debt
will be considered to be valid.
collectors are prohibited
oppressing, or being abusive in their efforts to collect on
a debt. Consumers can sue debt collectors who violate the Fair
Debt Collection Practices Act for actual and punitive damages.
more questions regarding credit bureaus and credit practices, please
Pennsylvania Ave, NW