Credit reports are very physical things. When thinking about them, you either grit your teeth, drop your jaw, or shrug your shoulders - depending on where you are in the needing-to-get-a-loan scenario. Some people get by for years without needing credit by operating on the pay-as-you-go premise, but when it comes time to purchase something of size, like a house or a car, suddenly the state of your credit becomes paramount - unless you have a rich uncle or get bonked on the head by a state lotto fairy's wand. And sometimes prospective employers ask to see a copy of your credit report - just to make sure they're about to hire a responsible, on-time-bill-paying worker.
The Fair Credit Reporting Act (FCRA) and its 1997 amendments have put into play a more level playing field for the consumer with regard to credit reports. This law strengthens privacy to records accessibility, enforces stricter guidelines for credit reporting agencies (CRAs), and also holds companies that give and receive data to and from CRAs more accountable.
The three biggies - national CRAs that hold your credit history in their hands - are Equifax (800-685-1111) www.equifax.com, Experian (888-397-3742) www.experian.com, and Trans Union (800-916-8800) www.transunion.com. Phone numbers and Web site addresses have been included because it's crucial to keep an eye on your credit reports - unless you're one of the above-mentioned individuals whose credit history doesn't matter. In that case, the mystery of why you're reading this would be arguably more significant. But for the other 90% of the population, these three CRAs can mean making or breaking a move to a new house, getting a much-needed car, or snagging the job of your dreams. So yes, it's a pretty big deal to keep up with what's being reported about you - without waiting until it's time to sign on the dotted line.
Everyone has the right to know what's in their credit reports. And CRAs must, by law, disclose all they have on you, including medical information, plus let you know their sources. CRAs must also, upon request, divulge who's been paying for reports on you for the past twelve months (twenty-four months, if requests have come from prospective employers).
You have the right to all this information, but not always for free. CRAs can charge up to nine dollars for credit reports, but if any of the following apply to you, the report is gratis:
- You've been denied credit in the past 60 days - You're not working but intend to look for a job within the next 60 days - You're on public assistance (welfare) - Your credit report is fraudulently erroneous
If you're convinced your credit reports have incomplete or inaccurate information, you can do more than grit your teeth. CRAs and companies that report to them are under the gun to correct any wrongs and make them right, but you must do your part by contacting them - in writing.
After getting your request, CRAs have 30 business days to look into the matter, which includes forwarding pertinent information to the business(es) that have smeared your sterling name with what you're now considering to be slanderous innuendo. After investigation, a reports get sent back to the CRAs with results either in your favor or not. If information has been found to be truly missing or in error, all CRAs must be advised and information on all your credit reports corrected.
If your dispute results in changes to your credit reports, you then get written results and free copies of your reports from the CRAs. And additionally, the lowdown, sneaky innuendo-slinging information provider must verify - VERIFY - the information they've so cruelly given AND the CRA gives you their name, address, and telephone number to make sure they do! To dispute an item with a rat, er, information provider, you do have to put it in writing. If and when that provider sends information to any CRA, a copy of your dispute must be included along with it. And if you're right and they're wrong, the provider can not use that information again. So there!
If a CRA or information provider just won't cave in and correct whatever it is you're disagreeing with them about, ask the CRA (in writing, of course!) to put your disagreement in your file and add it to future credit reports. That disagreement is then part of your report - for all prospective credit-givers to see and judge for themselves - but there is almost always a fee for this. So, if all else fails, and you're sick and tired of gritting your teeth, you can always resort to the "S" word - SUE. If you win, the CRA and/or information provider will be forced to cough up all damages those crummy credit reports have caused you and also compensate you for what it cost you to hire the lawyer you had to hock your soul to in order to take this drastic measure. Just make sure you've got all your ducks in a row - the lawyer can help you with this - before you make this move.
Okay. So the truth finally comes out, and it turns out you were, indeed, a few months late on some payments, or you just simply forgot about those silly bills you kept sticking in the back of a desk drawer. All is not lost. At least after seven years. Under most circumstances, CRAs only report negative information on your credit reports for that long. Maybe it's biblical, or maybe it's just that they want to clean out their files, but after those seven years, you start off again with a clean slate unless:
- You declare bankruptcy, which is reportable for 10 years. - You've been convicted of a criminal offense, which can be on all your credit reports (of all places!) forever - You apply for a job paying more than $75K a year, in which case information for a prospective employer remains available to the end of time - or your life - whichever comes first. - You apply for $150K or more of credit or life insurance, in which case information from your credit reports dating back to Day 1 is available. - You've got an unpaid lawsuit or a judgement against you, and the statute of limitations hasn't expired.
So, cheer up! Unless you're getting on up there in years, you'll almost always be able to start anew with fresh credit reports every seven years! Let's see . . . That's about seven times in a lifetime, if you start getting credit in your twenties. If you ARE getting older, and your credit is shot - hey, isn't it about time you straightened your act up?