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The Fair Credit Act

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The Fair Credit Reporting Act 15 USC 1681 (1992) and (1996) is an American federal law that regulates the collection dissemination and use consumer credit information along with the Fair Debt Collection Act. This forms the base of consumer credit rights in the U.S. This act also sets up guidelines for debt collectors on how to conduct business rights of consumers involved with debt collectors.

These acts protect those in debt from being harassed from creditors and to allow debtors to receive true and fair discharged debt information on a credit report. These acts are set in place so that debtors are fairly treated when paying debts, dealing with debt collectors or trying to purchase homes after bankruptcy.

You can find details on these protection acts online or at your local library. Knowing and understanding these acts can help you to protect yourself from creditors or other agencies taking advantage of your vulnerabilities. The consumer reporting agencies set forth reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a way which is fair and equitable to the consumer, in a way that offers confidentiality, accuracy, relevancy, and proper utilization of such information in accordance with the requirements of this act.

After a person files bankruptcy and debts are then discharged, a credit report can still show the bankruptcy but the debts that are discharged must show a balance owed at zero due to the FCRA or Fair Credit Reporting Act.

The banking system is dependent upon fair and accurate credit reporting. Without American federal laws such as the FCRA or the Fair Credit Reporting Act debtors and creditors could not be protected from fraud and dishonesty. This act regulates the collection dissemination and use of consumer credit information. Along with the Fair Debt Collection Act, it forms the base for consumer credit rights in the United States.

Without such a law in place creditors could easily turn people away and decline every loan type. Also creditors could abuse client information without this act. If a person has filed bankruptcy and later try's to purchase a home, without the FCRA a client could easily be rejected for the home loan due to the bankruptcy debts being seen as still owed even if they were discharged. The Fair Credit Reporting Act makes credit reports show discharged debts as a zero balance.

This act has guidelines for debt collectors on how to conduct business and defines rights for consumers involved with debt collectors and prescribes penalties for violations of this act. Consumer protection is key to this law. There are other laws such as the Bankruptcy Abuse Prevention Consumer Protection Act of 2005 that aid in consumer protection. There is a solid protection in place for those dealing with debt, credit and bankruptcy. You can see more details about the FCRA on sites such as http://www.epic.org/privacy/financial/fcra.html or by searching for this information at your local library. Understanding this act can aid us in feeling more confident about the credit and banking system.

The Fair Credit Act

The Free Credit Report Act is a law that acts as protection from potential threats to your credit information. This act keeps your credit information from being distributed to the wrong people for the wrong types of reasons. Because of this kind of protection, there is less of a chance that your credit information will be misused and manipulated by others.

This act protects you from your credit getting into the wrong hands, but there are a few people who are allowed access to your credit information for the purpose of checking it. So, for example, if you are applying for credit, the potential lender is allowed to check your credit history and see whether or not you qualify for the credit you are asking for. Here are a few of those types of people and why they are allowed to view your credit information.

1. Certain lenders, credit unions, banks, and department stores, depending on how many credit accounts you have where, are allowed to see your credit background. This is for the sole purpose of monitoring how well you are managing your credit and how punctual you are with your payments. The Fair Credit Report Act does not allow people like this to distribute your credit information to anyone else.

2. The companies with which you are insured are allowed to check your credit report for the same kind of reason. They are allowed to view how you are able to balance your credit debt and make your payments on time so that they can decide whether or not they can insure you without taking on possible risk of late payments.

3. Wherever you are applying for credit, whether it be a credit card, a car loan, or a mortgage, the people that you are asking the credit from are allowed to see your credit report to make sure that you qualify for credit. If you do not have a good credit history and have a low score, they have the right to deny you the credit.

4. Potential employers are allowed to access your credit information, but only with your permission. The only way they can view your credit history or credit score is if you give them your consent. Otherwise, they cannot access it for any reason.

This law, the Fair Credit Report Act, protects you from your credit information being handed out to people on the street, but it also protects you yourself. Your credit information also holds a lot of your personal information, like your birth date, phone numbers, and your social security number. Because of this act, your identity is also protected from those who would try to steal it and use your credit for their gain.

The Fair Credit Report Act also allows you to complain. It gives you the right to dispute any injustices done or mistakes made on your credit report. There is no promise that what you complain about will be fixed just because you complain, but you have the right to call them on it when there has been an error made.

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