If you've ever applied for a credit
card, a personal loan, or insurance, there's a file about you. This
file contains information on where you work and live, how you pay your
bills, and whether you've been sued, arrested, or filed for
Companies that gather and sell this
information are called Consumer Reporting Agencies (CRAs). The most
common type of CRA is the credit bureau. The information CRAs sell
about you to creditors, employers, insurers, and other businesses is
called a consumer report.
The Fair Credit Reporting Act (FCRA)
The FCRA is designed to promote
accuracy and ensure the privacy of information used in consumer
reports. Recent amendments to the Act expand your rights and place
additional requirements on CRAs. Businesses that supply information
about you to CRAs and those that use consumer reports also have new
responsibilities under the law.
Here are some questions consumers
commonly ask about consumer reports and CRAs-and the answers.
Q. How do I find the CRA that
has my report?
A. Contact the CRAs listed in the Yellow Pages under "credit" or
"credit rating and reporting." Because more than one CRA may have a
file on you, call each until you have located all the agencies
maintaining your file. The three major credit bureaus are:
In addition, anyone who takes
action against you in response to a report supplied by a CRA-such as
denying your application for credit, insurance, or employment-must
give you the name, address, and telephone number of the CRA that
provided the report.
Q. Do I have a right to know
what's in my report?
A. Yes, if you ask for it. The CRA must tell you everything in your
report, including medical information, and in most cases, the
sources of the information. The CRA also must give you a list of
everyone who has requested your report within the past year-two
years for employment related requests.
Q. Is there a charge for my
A. Sometimes. There's no charge if a company takes adverse action
against you, such as denying your application for credit, insurance
or employment, and you request your report within 60 days of
receiving the notice of the action. The notice will give you the
name, address, and phone number of the CRA. In addition, you're
entitled to one free report a year if you certify in writing that
(1) you're unemployed and plan to look for a job within 60 days, (2)
you're on welfare, or (3) your report is inaccurate because of
fraud. Otherwise, a CRA may charge you up to $9.00 for a copy of
Even if you have not been denied
credit, you may want to find out what information is in your credit
report. Some financial advisors suggest that you review your credit
report periodically for inaccuracies or omissions. This could be
especially important if you're considering a major purchase, such as
buying a home or a car. Checking in advance on the accuracy of the
information in your credit report could speed the credit-granting
Q. What type of information do
credit bureaus collect and sell?
A. Credit bureaus collect and sell four basic types of information.
Your name, birth date, Social
Security number, employer, and spouse's name are routinely noted. The
CRA also may provide information about your employment history, home
ownership, income, and previous address, if a creditor requests this
type of information.
Your accounts with different
creditors are listed, showing how much credit has been extended and
whether you've paid on time. Related events, such as referral of an
overdue account to a collection agency, may also be noted.
CRAs must maintain a record of all
creditors who have asked for your credit history within the past year,
and a record of those persons or businesses requesting your credit
history for employment purposes for the past two years.
Public record information
Events that are a matter of public
record, such as bankruptcies, foreclosures, or tax liens, may appear
in your report.
Building Up a Good Record
On your first attempt to get credit, you may face a common frustration: sometimes it seems you have to
already have credit to get credit. Some creditors will look only at your salary and job and the other financial information you
put on your application. But most also want to know about your track record in handling credit, namely how reliably you've
repaid past debts. They turn to the records kept by credit bureaus or credit-reporting agencies whose business is to collect,
store and report information about borrowers that is routinely supplied by many lenders. These records include the amount of
credit you have received and how faithfully you've paid it back.
Here are several ways you can begin to build up a good credit history:
-- Open a checking account or a savings account, or both. These do not begin your credit file, but may be
checked as evidence that you have money and know how to manage it. Cancelled checks can be used to show you pay utility bills or
rent regularly, a sign of reliability.
-- Apply for a department store credit card. Repaying credit card bills on time is a plus in credit
-- Ask whether you may deposit funds with a financial institution to serve as collateral for a credit
card; some institutions will issue a credit card with a credit limit usually no greater than the amount on deposit.
-- If you're new in town, write for a summary of any credit record kept by a credit bureau in your former
town. (Ask the bank or department store in your old hometown for the name of the agency it reports to.)
-- If you don't qualify on the basis of your own credit standing, offer to have someone cosign your
-- If you're turned down, find out why and try to clear up any misunderstandings.
Under the law, both the CRA and the
organization that provided the information to the CRA,
such as a bank or credit card
company, have responsibilities for correcting inaccurate or incomplete
information in your report. To protect all your rights under the law,
contact both the CRA and the information provider if you have a
1 First, tell the CRA in writing
what information you believe is inaccurate. Include copies (not
originals) of documents that support your position. In addition to
providing your complete name and address, your letter should clearly
identify each item in your report you dispute, state the facts and
explain why you dispute the information, and request deletion or
correction. You may want to enclose a copy of your report with the
items in question circled. Your letter may look something like the one
below. Send your letter by certified mail, return receipt requested,
so you can document what the CRA received. Keep copies of your dispute
letter and enclosures.
Your City, State, Zip Code
Name of Credit Reporting Agency
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the
following information in my file. The items I dispute also are
encircled on the attached copy of the report I received.
This item (identify item(s)
disputed by name of source, such as creditors or tax court, and
identify type of item, such as credit account, judgment, etc.)
is (inaccurate or incomplete) because (describe what is
inaccurate or incomplete and why). I am requesting that the item
be deleted (or request another specific change) to correct the
Enclosed are copies of (use
this sentence if applicable and describe any enclosed
documentation, such as payment records, court documents)
supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon
Enclosures: (List what you
CRAs must reinvestigate the item(s) in question-usually within 30 days-unless they consider your
dispute frivolous. They also must forward all relevant data you
provide about the dispute to the information provider. After the
information provider receives notice of a dispute from the CRA, it
must investigate, review all relevant information provided by the CRA, and report the results to the CRA. If the information provider
finds the disputed information to be inaccurate, it must notify all
nationwide CRAs so that they can correct this information in your
Disputed information that cannot
be verified must be deleted from your file.
If your report contains
inaccurate information, the CRA must correct it.
If an item is incomplete, the
CRA must complete it. For example, if your file showed that you
were late making payments, but failed to show that you were no
longer delinquent, the CRA must show that your payments are now
If your file shows an account
that belongs only to another person, the CRA must delete it.
When the reinvestigation is
complete, the CRA must give you the written results and a free copy
of your report if the dispute results in a change. If an item is
changed or removed, the CRA cannot put the disputed information back
in your file unless the information provider verifies its accuracy
and completeness, and the CRA gives you a written notice of its
intent to reinsert the items that includes the name, address, and
phone number of the provider.
If you request, the CRA must send
notices of any correction to anyone who received your report in the
past six months. You can have a corrected copy of your report sent
to anyone who received a copy during the past two years for
employment purposes. If a reinvestigation does not resolve your
dispute, ask the CRA to include your statement of the dispute in
your file and in future reports.
In addition to writing to the CRA,
you should tell the creditor or other information provider in
writing that you dispute an item. Be sure to include copies (not
originals) of documents that support your position. Many providers
specify an address for disputes. If the provider continues to report
the disputed item to any CRA after receiving your notice, it must
include a notice that you dispute the item. If you are correct-that
is, if the information is not accurate-the information provider may
not report it again.
Accurate Negative Information
When negative information in your
report is accurate, only the passage of time can assure its removal.
Accurate negative information generally can stay on your report for
seven years. There are certain exceptions:
Bankruptcy information may be
reported for 10 years.
Credit information reported in
response to an application for a job with a salary of more than
$75,000 has no time limit.
Information about criminal
convictions has no time limit.
Credit information reported
because of an application for more than $150,000 worth of credit or
life insurance has no time limit.
Default information concerning
U.S. Government insured or guaranteed student loans can be reported
for seven years after certain guarantor actions.
Information about a lawsuit or an
unpaid judgment against you can be reported for seven years or until
the statute of limitations runs out, whichever is longer.
Seven-year Reporting Period
There is a standard method for
calculating the seven-year reporting period. Generally, the period
runs from the date that the event took place.
With regard to any delinquent
account placed for collection-internally or by referral to a
third-party debt collector, whichever is earlier-charged to profit and
loss, or subjected to any similar action, the seven-year period is
calculated from the date of the delinquency that occurred immediately
before the collection activity, charge to profit and loss, or similar
action. For example, assume that your payments on a loan were late in
January, but that you caught up in February. You were late again in
May, but caught up in July. You were again late in September, but did
not catch up before the account was turned over to a collection agency
in December. You made no more payments on the account, and it is
charged to profit and loss in July of the following year.
Under the FCRA, the January and May
late payments each can be reported for seven years. The collection
activity and the charge to profit and loss can be reported for seven
years from the date of the September payment, which was the
delinquency that occurred immediately before those activities.
Adding Accounts to Your File
Your credit file may not reflect
all your credit accounts. Although most national department store and
all-purpose bank credit card accounts will be included in your file,
not all creditors supply information to CRAs: Some travel,
entertainment, gasoline card companies, local retailers, and credit
unions are among those creditors that don't.
If you've been told that you were
denied credit because of an "insufficient credit file" or "no credit
file" and you have accounts with creditors that don't appear in your
credit file, ask the CRA to add this information to future reports.
Although they are not required to do so, many CRAs will add verifiable
accounts for a fee. However, understand that if these creditors do not
report to the CRA on a regular basis, the added items will not be
updated in your file.
Are you having trouble paying your
bills? Are you getting dunning notices from creditors? Are your
accounts being turned over to debt collectors? Are you worried about
losing your home or your car?
You're not alone. Many people face
financial crises at some time in their lives. Whether the crisis is
caused by personal or family illness, the loss of a job, or simple
overspending, it can seem overwhelming, but often can be overcome. The
fact of the matter is that your financial situation doesn't have to go
from bad to worse.
If you or someone you know is in
financial hot water, consider these options: realistic budgeting,
credit counseling from a reputable organization, debt consolidation,
or bankruptcy. How do you know which will work best for you? It
depends on your level of debt, your level of discipline, and your
prospects for the future.
Developing a Budget
The first step toward taking
control of your financial situation is to do a realistic assessment of
how much money comes in and how much money you spend. Start by listing
your income from all sources. Then, list your "fixed" expenses-those
that are the same each month-such as your mortgage payments or your
rent, car payments, or insurance premiums. Next, list the expenses
that vary, such as entertainment, recreation, or clothing. Writing
down all your expenses-even those that seem insignificant-is a helpful
way to track your spending patterns, identify the expenses that are
necessary, and prioritize the rest. The goal is to make sure you can
make ends meet on the basics: housing, food, health care, insurance,
Your public library has information
about budgeting and money management techniques. Low cost budget
counseling services that can help you analyze your income and expenses
and develop a budget and spending plan also are available in most
communities. Check your Yellow Pages or contact your local bank or
consumer protection office for information about them. In addition,
many universities, military bases, credit unions, and housing
authorities operate nonprofit financial counseling programs.
Contacting Your Creditors
Contact your creditors immediately
if you are having trouble making ends meet. Tell them why it's
difficult for you, and try to work out a modified payment plan that
reduces your payments to a more manageable level. Don't wait until
your accounts have been turned over to a debt collector. At that
point, the creditors have given up on you.
Dealing with Debt Collectors
The Fair Debt Collection Practices
Act is the federal law that dictates how and when a debt collector may
contact you. A debt collector may not call you before 8 a.m., after 9
p.m., or at work if the collector knows that your employer doesn't
approve of the calls. Collectors may not harass you, make false
statements, or use unfair practices when they try to collect a debt.
Debt collectors must honor a written request from you to stop further
If you aren't disciplined enough to
create a workable budget and stick to it, can't work out a repayment
plan with your creditors, or can't keep track of mounting bills,
consider contacting a credit counseling service. Your creditors may be
willing to accept reduced payments if you enter into a debt repayment
plan with a reputable organization. In these plans, you deposit money
each month with the credit counseling service. Your deposits are used
to pay your creditors according to a payment schedule developed by the
counselor. As part of the repayment plan, you may have to agree not to
apply for-or use-any additional credit while you're participating in
A successful repayment plan
requires you to make regular, timely payments, and could take 48
months or longer to complete. Ask the credit counseling service for an
estimate of the time it will take you to complete the plan. Some
credit counseling services charge little or nothing for managing the
plan; others charge a monthly fee that could add up to a significant
charge over time. Some credit counseling services are funded, in part,
by contributions from creditors.
While a debt repayment plan can
eliminate much of the stress that comes from dealing with creditors
and overdue bills, it does not mean you can forget about your debts.
You still are responsible for paying any creditors whose debts are not
included in the plan. You are responsible for reviewing monthly
statements from your creditors to make sure your payments have been
received. If your repayment plan depends on your creditors agreeing to
lower or eliminate interest and finance charges, or waive late fees,
you are responsible for making sure these concessions are reflected on
A debt repayment plan does not
erase your negative credit history. Accurate information about your
accounts can stay on your credit report for up to seven years. In
addition, your creditors will continue to report information about
accounts that are handled through a debt repayment plan. For example,
creditors may report that an account is in financial counseling, that
payments have been late or missed altogether, or that there are
write-offs or other concessions. A demonstrated pattern of timely
payments, however, will help you get credit in the future.
Auto and Home Loans
Debt repayment plans usually cover
unsecured debt. Your auto and home loan, which are considered secured
debt, may not be included. You must continue to make payments to these
Most automobile financing
agreements allow a creditor to repossess your car any time you're in
default. No notice is required. If your car is repossessed, you may
have to pay the full balance due on the loan, as well as towing and
storage costs, to get it back. If you can't do this, the creditor may
sell the car. If you see default approaching, you may be better off
selling the car yourself and paying off the debt: You would avoid the
added costs of repossession and a negative entry on your credit
If you fall behind on your
mortgage, contact your lender immediately to avoid foreclosure. Most
lenders are willing to work with you if they believe you're acting in
good faith and the situation is temporary. Some lenders may reduce or
suspend your payments for a short time. When you resume regular
payments, though, you may have to pay an additional amount toward the
past due total. Other lenders may agree to change the terms of the
mortgage by extending the repayment period to reduce the monthly debt.
Ask whether additional fees would be assessed for these changes, and
calculate how much they total in the long run.
If you and your lender cannot work
out a plan, contact a housing counseling agency. Some agencies limit
their counseling service to homeowners with FHA mortgages, but many
offer free help to any homeowner who's having trouble making mortgage
payments. Call the local office of the Department of Housing and Urban
Development (HUD) or the housing authority in your state, city, or
county for help in finding a housing counseling agency near you.
You may be able to lower your cost
of credit by consolidating your debt through a second mortgage or a
home equity line of credit. Think carefully before taking this on.
These loans require your home as collateral. If you can't make the
payments-or if the payments are late-you could lose your home.
The costs of these consolidation
loans can add up. In addition to interest on the loan, you pay
"points." Typically, one point is equal to one percent of the amount
you borrow. Still, these loans may provide certain tax advantages that
are not available with other kinds of credit.
Personal bankruptcy generally is
considered the debt management tool of last resort because the results
are long-lasting and far-reaching. A bankruptcy stays on your credit
report for 10 years, making it difficult to acquire credit, buy a
home, get life insurance, or sometimes get a job. However, it is a
legal procedure that offers a fresh start for people who can't satisfy
their debts. Individuals who follow the bankruptcy rules receive a
discharge-a court order that says they do not have to repay certain
There are two primary types of
personal bankruptcy: Chapter 13 and Chapter 7. Each must be filed in
federal bankruptcy court. The current fees for seeking bankruptcy
relief are $160: a filing fee of $130 and an administrative fee of
$30. Attorney fees are additional and can vary widely. The
consequences of bankruptcy are significant and require careful
Chapter 13 allows you, if you have
a regular income and limited debt, to keep property, such as a
mortgaged house or car, that you otherwise might lose. In Chapter 13,
the court approves a repayment plan that allows you to pay off a
default during a period of three to five years, rather than surrender
Chapter 7, known as straight
bankruptcy, involves liquidating all assets that are not exempt.
Exempt property may include cars, work-related tools and basic
household furnishings. Some property may be sold by a court-appointed
official-a trustee-or turned over to creditors. You can receive a
discharge of your debts under Chapter 7 only once every six years.
Both types of bankruptcy may get
rid of unsecured debts and stop foreclosures, repossessions,
garnishments, utility shut-offs, and debt collection activities. Both
also provide exemptions that allow you to keep certain assets,
although exemption amounts vary. Personal bankruptcy usually does not
erase child support, alimony, fines, taxes, and some student loan
obligations. Also, unless you have an acceptable plan to catch up on
your debt under Chapter 13, bankruptcy usually does not allow you to
keep property when your creditor has an unpaid mortgage or lien on it.
Turning to a business that offers
help in solving debt problems may seem like a reasonable
solution when your bills become
unmanageable. Be cautious. Before you do business with any company,
check it out with your local consumer protection agency or the Better
Business Bureau in the company's location.
Ads Promising Debt Relief May Be
Consumer debt is at an all-time
high. What's more, a record number of consumers-nearly 1.5 million in
2001-are filing for bankruptcy. Whether your debt dilemma is the
result of an illness, unemployment, or overspending, it can seem
overwhelming. In your effort to get solvent, be on the alert for
advertisements that offer seemingly quick fixes. While the ads pitch
the promise of debt relief, they rarely say relief may be spelled
b-a-n-k-r-u-p-t-c-y. And although bankruptcy is one option to deal
with financial problems, it's generally considered the option of last
resort. The reason: it has a long-term negative impact on your
creditworthiness. A bankruptcy stays on your credit report for 10
years, and can hinder your ability to get credit, a job, insurance, or
even a place to live.
The Federal Trade Commission (FTC)
cautions consumers to read between the lines when faced with ads in
newspapers, magazines, or even telephone directories that say:
"Consolidate your bills
into one monthly payment without borrowing"
"STOP credit harassment,
foreclosures, repossessions, tax levies and garnishments"
"Keep Your Property"
"Wipe out your debts!
Consolidate your bills! How? By using the protection and
assistance provided by federal law. For once, let the law work
You'll find out later that such
phrases often involve bankruptcy proceedings, which can hurt your
credit and cost you attorneys' fees.
Advance-Fee Loan Scams
These scams often target consumers
with credit problems or consumers who have difficulty getting credit.
In exchange for an up-front fee, these companies guarantee that
applicants will get the credit they want-usually a credit card or a
The up-front fee may range from
$100 to several hundred dollars. Resist the temptation to follow up on
advance-fee loan guarantees. They may be illegal. Many legitimate
creditors offer extensions of credit, such as credit cards, loans, and
mortgages, through telemarketing and require an application fee or
appraisal fee in advance. But legitimate creditors never guarantee in
advance that you'll get the loan. Under the federal Telemarketing
Sales Rule, a seller or telemarketer who guarantees or represents a
high likelihood of your getting a loan or some other extension of
credit may not ask for or receive payment until you've received the
Recognizing an Advance-Fee Loan
There are many fraudulent loan
brokers and other individuals misrepresenting the availability of
credit and credit terms. One of their favorite strategies is the
"advance-fee" loan scam. That's where they claim to guarantee that
they can get a loan or other type of credit for you-but you must pay a
fee before you apply.
Ads for advance-fee loans often
appear in the classified ad section of local and national newspapers
and magazines. They also may appear in mailings, radio spots, and on
local cable stations. Often, these ads feature "900" numbers, which
result in charges on your phone bill. In addition, these companies
often use delivery systems other than the U.S. Postal Service, such as
overnight or courier services, to avoid detection and prosecution by
Don't confuse a legitimate credit
offer with an advance-fee loan scam. An offer for credit from a bank,
savings and loan, or mortgage broker generally requires your verbal or
written acceptance of the loan or credit offer. The offer usually is
subject to a check of your credit report after you apply to make sure
you meet their credit standards. You are usually not required to pay a
fee in order to get the credit.
Be suspicious of anyone who calls
you on the phone and says they can guarantee you will get a loan if
you pay in advance. Hang up. It's against the law.
Here are some points to keep in
mind before you respond to ads that promise easy credit, regardless of
your credit history:
Most legitimate lenders will not
"guarantee" that you will get a loan or a credit card before you
apply, especially if you have bad credit, or a bankruptcy.
It is an accepted and common
practice for reputable lenders to require payment for a credit
report or appraisal. You also may have to pay a processing or
Never give your credit card
account number, bank account information, or Social Security number
out over the telephone unless you are familiar with the company and
know why the information is necessary.
Credit Repair Scams
You see the ads in newspapers, on
TV, and on the Internet. You hear them on the radio. You get fliers in
the mail. You may even get calls from telemarketers offering credit
repair services. They all make the same claims:
"Credit problems? No
"We can erase your bad
"Create a new credit
"We can remove
bankruptcies, judgments, liens, and bad loans from your credit
Do yourself a favor and save some
money too. Don't believe these statements. Only time, a conscientious
effort, and a plan for repaying your debt will improve your credit
Every day, companies nationwide
appeal to consumers with poor credit histories. They promise, for a
fee, to clean up your credit report so you can get a car loan, a home
mortgage, insurance, or even a job. The truth is, they can't deliver.
After you pay them hundreds or thousands of dollars in up-front fees,
these companies do nothing to improve your credit report; many simply
vanish with your money.
The Warning Signs
If you decide to respond to a
credit repair offer, beware of companies that:
want you to pay for credit repair
services before any services are provided;
do not tell you your legal rights
and what you can do-yourself-for free;
recommend that you not contact a
credit bureau directly;
suggest that you try to invent a
"new" credit report by applying for an Employer Identification
Number to use instead of your Social Security number; or
advise you to dispute all
information in your credit report or take any action that seems
illegal, such as creating a new credit identity. If you follow
illegal advice and commit fraud, you may be subject to prosecution.
You could be charged and prosecuted
for mail or wire fraud if you use the mail or telephone to apply for
credit and provide false information. It's a federal crime to make
false statements on a loan or credit application, to misrepresent your
Social Security number, and to obtain an Employer Identification
Number from the Internal Revenue Service under false pretenses.
The Credit Repair Organizations
By law, credit repair organizations
must give you a copy of the "Consumer Credit File Rights Under State
and Federal Law" before you sign a contract. They also must give you a
written contract that spells out your rights and obligations. Read
these documents before signing the contract. The law contains specific
consumer protections. For example, a credit repair company cannot:
make false claims about their
charge you until they have
completed the promised services; or
perform any services until they
have your signature on a written contract and have completed a
three-day waiting period. During this time, you can cancel the
contract without paying any fees.
If You Are A Victim - Where to
If you've had a problem with any of
the scams described here, contact your local consumer protection
agency, state Attorney General (AG), or Better Business Bureau. Many
AGs have toll-free consumer hotlines. Check with your local directory
If youve been
denied credit, insurance, or employment because of information supplied by a
CRA, the FCRA says the company you applied to must give you the CRAs
name, address, and telephone number. If you contact the agency for a copy of
your report within 60 days of receiving a denial notice, the report is free. In
addition, youre entitled to one free copy of your report a year if you
can prove that (1) youre unemployed and plan to look for a job within 60
days, (2) youre on welfare, or (3) your report is inaccurate because of
fraud. Otherwise, a CRA may charge you up to $9.00 for a copy of your
Under the FCRA, both the CRA and
the organization that provided the information to the CRA, such as a bank or
credit card company, have responsibilities for correcting inaccurate or
incomplete information in your report. To protect all your rights under the
law, contact both the CRA and the information provider.
First, tell the CRA in writing
what information you believe is inaccurate. Include copies (NOT originals)
of documents that support your position. In addition to providing your complete
name and address, your letter should clearly identify each item in your report
you dispute, state the facts and explain why you dispute the information, and
request deletion or correction. You may want to enclose a copy of your report
with the items in question circled. Your letter may look something like the
sample below. Send your letter by certified mail, return
receipt requested, so you can document what the CRA received. Keep copies of
your dispute letter and enclosures.
CRAs must reinvestigate the items
in questionusually within 30 daysunless they consider your dispute
frivolous. They also must forward all relevant data you provide about the
dispute to the information provider. After the information provider receives
notice of a dispute from the CRA, it must investigate, review all relevant
information provided by the CRA, and report the results to the CRA. If the
information provider finds the disputed information to be inaccurate, it must
notify all nationwide CRAs so they can correct this information in your
- Disputed information that
cannot be verified must be deleted from your file.
- If your report contains
erroneous information, the CRA must correct it.
- If an item is incomplete, the
CRA must complete it. For example, if your file showed that you were late
making payments, but failed to show that you were no longer delinquent, the CRA
must show that youre current.
- If your file shows an account
that belongs only to another person, the CRA must delete it.
When the reinvestigation is
complete, the CRA must give you the written results and a free copy of your
report if the dispute results in a change. If an item is changed or removed,
the CRA cannot put the disputed information back in your file unless the
information provider verifies its accuracy and completeness, and the CRA gives
you a written notice that includes the name, address, and phone number of the
Also, if you request, the CRA
must send notices of corrections to anyone who received your report in the past
six months. Job applicants can have a corrected copy of their report sent to
anyone who received a copy during the past two years for employment purposes.
If a reinvestigation does not resolve your dispute, ask the CRA to include your
statement of the dispute in your file and in future reports.
Second, in addition to writing to
the CRA, tell the creditor or other information provider in writing that
you dispute an item. Again, include copies (NOT originals) of documents that
support your position. Many providers specify an address for disputes. If the
provider then reports the item to any CRA, it must include a notice of your
dispute. In addition, if you are correctthat is, if the disputed
information is not accuratethe information provider may not use it
When negative information
in your report is accurate, only the passage of time can assure its removal.
Accurate negative information can generally stay on your report for 7 years.
There are certain exceptions:
- Information about criminal
convictions may be reported without any time limitation.
- Bankruptcy information may be
reported for 10 years.
- Credit information reported in
response to an application for a job with a salary of more than $75,000 has no
- Credit information reported
because of an application for more than $150,000 worth of credit or life
insurance has no time limit.
- Information about a lawsuit or
an unpaid judgment against you can be reported for seven years or until the
statute of limitations runs out, whichever is longer.
Adding Accounts to
Your credit file may not
reflect all your credit accounts. Although most national department store and
all-purpose bank credit card accounts will be included in your file, not all
creditors supply information to CRAs: Some travel, entertainment, gasoline card
companies, local retailers, and credit unions are among those creditors that
If youve been told you were
denied credit because of an "insufficient credit file" or "no credit file" and
you have accounts with creditors that dont appear in your credit file,
ask the CRA to add this information to future reports. Although they are not
required to do so, many CRAs will add verifiable accounts for a fee. You
should, however, understand that if these creditors do not report to the CRA on
a regular basis, these added items will not be updated in your file.