When you apply for things like a new credit card, a mortgage or an apartment, the companies you apply with will often request a copy of your credit report from one or more of the three nationwide credit bureaus – Equifax, TransUnion, and Experian. The companies use the information in your credit report as one factor in helping them decide whether to approve your application based on their decision-making criteria.
All of these companies – the lenders and creditors you apply with and the credit bureaus – must operate under laws protecting consumers and how their credit information can be used.
The primary law is the Fair Credit Reporting Act (FCRA). Among other things, the FCRA limits who can access your credit reports and for what purposes. Here are some of the rights provided to consumers under the FCRA:
Credit bureaus must provide your credit report to you when you ask for it.
If you ask for a copy of your credit report and verify your identity, a credit bureau must provide it to you. Consumers are entitled to one free credit report every 12 months from each of the three nationwide credit bureaus.
Ready to get your free credit report? Please review instructions here.
Credit bureaus must limit access to your credit information.
The only people or companies allowed to access your credit report are those with “permissible purpose.” This means they must have one of many very specific reasons to be checking your credit. That might be because you’ve applied for a loan or credit card, for example, or you’re renting an apartment.
Who has permissible purpose? Here are some examples:
- Lenders and creditors you are applying for credit with
- Lenders who wish to prequalify you for credit or insurance
- Existing creditors you have a relationship with
- Debt collection companies to use in collecting payment
- Insurance companies, to underwrite insurance involving you
- Employers or prospective employers (with your permission)
- Rental companies/landlords, phone and utility companies
- Certain government agencies
Learn more about permissible purpose and who can access your credit report here.
A potential employer must get your written permission before accessing your credit report.
You must provide written consent to an employer before the employer can request your credit report from a credit bureau.
Credit bureaus must investigate disputed information and correct or delete inaccurate information.
If you believe your credit report contains inaccurate or incomplete information and file a dispute with a credit bureau, the bureau must investigate the dispute within a specific period of time. If the investigation finds the disputed information is inaccurate, or if the information can’t be verified, the bureau must correct that information or delete it from your credit report. If an investigation fails to resolve your dispute, you can ask the credit bureau to add a statement to your credit report explaining the matter.
Credit bureaus must delete outdated information after certain periods of time.
The FCRA specifies how long credit bureaus can keep certain types of information on your credit reports. Negative information generally must be removed after 7 years.
Credit bureaus must remove your name from marketing lists if you ask.
If you don’t want to receive unsolicited pre-screened offers for credit cards or insurance, you can ask the three nationwide credit bureaus to stop sharing your information for those purposes. Call (888) 5-OPT OUT or visit www.optoutprescreen.com.
Credit bureaus must add fraud and active duty military alerts to your file if you ask.
If you believe you are a victim of identity theft, you can add a one-year initial fraud alert to your credit file for free. With a fraud alert, potential lenders and creditors must take reasonable steps to verify your identity, such as contacting you by phone, before extending credit in your name. If you are active duty military, you may place a one-year active duty military alert to your file to help guard against identity theft. If you have been a victim of identity theft or fraud and have a police or law enforcement report or a Federal Trade Commission Identity Theft Report, you can add an extended fraud alert to your credit report. An extended fraud alert lasts for seven years.
Please review more information on how to add fraud and active duty military alerts to your credit report.
Credit bureaus must give you your credit score if you ask.
There are many different credit scores, and each bureau has its own method of calculating them. You can request your credit score from the nationwide credit bureaus. You may need to pay a fee for this.
If they deny you credit, lenders and creditors must tell you the information they used and where it came from.
Any potential lender or creditor who uses information in your credit report to deny your application for credit, insurance or employment, or takes other adverse action against you, must tell you, and must provide the name, address and phone number of the nationwide credit bureau where they got the information.
To read more about your rights under the FCRA, click here for a summary from the Consumer Financial Protection Bureau.