Twenty Percent Of Consumers Have Errors On At Least One Of Their Three Credit Reports
We all know that our credit score affects our ability to obtain credit as well as influence how much interest we will pay for the credit we receive. But, did you know that your credit score also affects your ability to obtain insurance, the amount you will pay for insurance and whether or not you can get a cell phone? Unfortunately, the heavily relied upon information on credit reports is frequently wrong. A recent congressionally mandated study conducted by the Federal Trade Commission (hereinafter FTC) found that twenty percent of consumers had errors on at least one of their three credit reports. Obviously, those of us in California (especially in San Jose or the San Francisco Bay Area) should be worried about paying higher interest rates on mortgage loans for real estate that commands higher prices than just about anywhere else in the U.S.
The Fair Credit Reporting Act Helped Some Consumers Correct The Mistakes
The FTC is responsible for assisting consumers prevent fraudulent, deceptive and unfair business practices. Additionally, they provide information to consumers about how to recognize errors on their credit report and how to have the errors corrected. The FTC provided the study participants with an associate to help them spot the problems on their credit reports. Then the FTC encouraged consumers to use the Fair Credit Reporting Act ("FCRA") to resolve any potential credit report errors. Four out of five study participants who filed disputes saw some type of modification to their credit report and approximately ten percent of the study participants saw a change in their credit score after the credit reporting agencies ("CRA") corrected the errors on their credit report.
What To Do If Contacting The Credit Reporting Agencies Yourself Does Not Work
While some of the study participants' credit report errors were fixed, what happened to the other participants who did not see any resolution? Once a dispute is raised with the CRA, they are required to contact the creditor to confirm the accuracy of the reported debt. If the creditor informs the CRA that the debt is being reported accurately, the CRA may not change the credit report. If this happens to you, contact an attorney to discuss your rights and your legal options. One of your options may be to file a lawsuit against the creditor or collector who is reporting the debt incorrectly under the FCRA or Fair Debt Collection Practices Act ("FDCPA"). The FDCPA was enacted by congress to protect consumers against both abusive and mistaken collection activity. Furthermore, California's Rosenthal Fair Debt Collection Practices Act, and the California Consumer Credit Reporting Act, may assist consumers in California against illegal and deceptive collection activity, and incorrect credit reporting.
You Have Rights, Use Them
The FTC study clearly shows that we all must assume a bigger role in monitoring our credit report. The FTC suggests you obtain a copy of your credit report regularly. Once a year, you can obtain a free copy of your credit report from www.annualcreditreport.com. If you find errors on your credit report be proactive and ask that the errors be corrected. If the CRA does not fix the errors, seek the advice of a consumer right's attorney.