What is the fair credit reporting act?

The Fair Credit Reporting Act (FCRA) is a federal law which regulates the activities of credit reporting bureaus. Private credit reporting bureaus, such as TRW Information Services, Equifax Credit Information Services and Trans Union Credit Information Company, maintain records of financial payment histories, public record data (such as unlawful detainer actions taken against you, or money judgments entered against you), along with personal identification information. Credit reporting bureaus sell this information to creditors. It is this information that helps a creditor decide whether or not to offer you credit.

The FCRA punishes unauthorized persons who obtain credit reports, as well as employees of credit reporting bureaus who furnish credit reports to unauthorized persons. The FTC also places responsibility on those who supply the reporting bureaus with the initial information.

If the information found on your credit report reflects responsible use of credit, then you need not worry - you should be able to obtain credit to purchase goods and services, rent an apartment, obtain a home mortgage loan, apply for insurance, and even obtain employment.

However, the information on file with credit reporting bureaus may be used against you, to deny you credit, employment, or even the ability to rent an apartment. It is a good idea to check your credit reports on an annually. This way you know what information is being made available to creditors before it is disclosed to them. Credit reporting bureaus are allowed to charge you a reasonable fee to obtain a copy of your credit report. If credit has been denied to you based upon information obtained from a credit reporting bureau, the creditor must provide you with the credit reporting bureaus' name and address. If you request (by telephone, mail or in person) a copy of your credit report from such credit reporting bureau within thirty days of being denied credit, the bureau must send your credit report to you for free, including the names of creditors who have provided the information to the bureau, and the names of everyone who has received a credit report on you in the last six months, or an employment report from the last two years.