Credit Bureaus - Doctor Of Credit

Credit bureaus (legally called consumer reporting agencies (CRAs) under the Fair Credit Report Act) are responsible for collecting credit information on individuals. This information is supplied by creditors and is protected by various consumer protection legislation.

There are a total of three CRAs (sometimes wrongly referred to as credit reporting agencies) in the USA, they are: Experian, Equifax & TransUnion. Consumer reporting agencies only handle information relating to individuals, corporation credit data is handled by credit rating agencies.

Contents

1 Consumer Reporting Agencies & Credit Scores
2 Credit Bureaus And The Law
- 2.1 Fair Credit Reporting Act(FCRA)
- 2.2 Fair And Accurate Transaction Act (FACTA)
3 Credit Bureau Disputes
- 3.1 Dispute Credit Reports Online
- 3.2 Dispute Via Phone Or Post
4 Credit Bureau Contact Information

Consumer Reporting Agencies & Credit Scores

All three of the consumer report agencies apply complicated scoring algorithms to individual credit reports to produce credit scores. These scores are sold to creditors and are used to aid them in credit decisions such as:

Should this individual be approved for this loan?
What APR (annual percentage rate) should this individual be offered?

The most popular of these scores is a FICO score or variation thereof, which is used in 90% of lending decisions.

While individuals now have the right to access their credit reports once annually for free under the FCRA by either phone, mail or online at https://www.annualcreditreport.com/, they are not yet required to provide a free credit score to individuals.

Find out how to get your free credit report by reading our guide

Consmer reporting agencies are now selling credit scores either directly to consumers or through a third party such as myFICO which is the consumer arm of FICO, the most popularly used credit score with lenders.

Not all credit scores are created equal.

There are a number of companies selling what is known as FAKO scores, these are credit scores that they’ve created themselves and are generally not those used by lenders. Find out the difference between various credit scores and make sure you find out the ones lenders look at.

Find out how to get a Free FICO score, the score lenders look at

There are also a large number of what the FCRA describes as nationwide specialty consumer reporting agencies which handle data relating to any of the following: medical records or payments, residential or tenant history, check writing history, employment history, insurance claims. These specialty agencies are sometimes wrongly confused with consumer reporting agencies.

Credit Bureaus And The Law

Because consumer reporting agencies collect such sensitive information about individuals, government has made a point of implementing a number of key consumer protections through the introduction of the following acts and regulations:

Fair Credit Reporting Act(FCRA)

Below is a summary of the more important aspects of FCRA, the full document can be viewed on the FTC website or by clicking here. For a more in depth summary we recommend reading the short summary that the Yale university put together.

Negative information that’s successfully removed due to a consumers dispute cannot be readded without notifying the consumer within five days by writing
Negative information cannot stay for more than seven years. This excludes bankruptcies (can stay for ten years) and tax liens (stay for seven years starting from when final payment is made)

Fair And Accurate Transaction Act (FACTA)

FACTA is an amendment to FCRA that was added in 2003. You can view the amendment by viewing the full FCRA here. FACTA added one main point of particular interest to consumers:

FACTA requires each of the three consumer consumer reporting agencies to allow consumers free access to their credit reports at the consumers request at least once annually.

Other laws and regulations of interest to consumers are: Fair Debt Collection Practices Act, (FDCPA), Fair Credit Billing Act (FCBA) & Regulation B. The Fair Trade Comission (FTC) is responsible for enforcing these acts. Office Of The Comptroller Of The Currency is in charge of regulations for creditors.

Credit Bureau Disputes

If inaccurate information appears on an individuals credit report they need to dispute this information with all of the credit bureaus reporting these inaccuracies.

Tip: The burden of proof lies on the creditor. If they can’t prove that the information is supplied is correct within 30 (45 if the incorrect information was found via a free credit report) days it must be removed by the consumer reporting agency. It’s not up to the individual to proof that the information is incorrect. This is explicitly stated in the FCRA.

It’s possible for consumers to dispute incorrect or inaccurate items on their report online, via phone or via post.

Dispute Credit Reports Online

Dispute Via Phone Or Post

To dispute via the phone or post, individuals should use one of the contact numbers or addresses found below. If disputing via post consumers should include a letter of dispute along with any supporting evidence they may have.

Read our guide on how to remove negative credit items from a credit report