Yes, the Fair Credit Reporting Act gives you a way to challenge a credit report error without a lawyer: a dispute that the credit bureau generally must reinvestigate within 30 days. Separately, federal law may allow a civil action against a company that fails to comply with the FCRA, depending on the facts.
Most people searching for an inaccurate credit report attorney found the error at a bad moment: a loan denied, a higher rate quoted, an apartment application stalled, or an account on the report that they never opened. Some have already disputed it once and received a letter saying the item was "verified." The question underneath is whether the dispute process alone is enough, or whether the law offers something more when a company will not correct its records. This page covers what federal law requires of credit bureaus and the companies that report to them, the errors that come up most often, the dispute process, the remedies the statute makes potentially available, and what this page does not address.
What the Fair Credit Reporting Act Requires of Credit Bureaus and Furnishers
The Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., is federal law that applies across the United States. It governs two kinds of companies at the center of most credit report problems:
- Consumer reporting agency. A company that compiles and sells reports about consumers. The CFPB explains that credit reporting companies are also called credit bureaus or consumer reporting agencies.
- Furnisher. A company that supplies information about a consumer to a consumer reporting agency, such as a lender, a card issuer or a collection agency.
The accuracy duty. Under 15 U.S.C. § 1681e(b), whenever a consumer reporting agency prepares a consumer report, it must follow reasonable procedures to assure maximum possible accuracy of the information about the person the report concerns.
The reinvestigation duty. A reinvestigation is the review a bureau must conduct after a consumer disputes an item. Under 15 U.S.C. § 1681i(a), when a consumer disputes the completeness or accuracy of an item in their file and notifies the agency directly or through a reseller, the agency must, free of charge, conduct a reasonable reinvestigation and record the item's current status or delete it, subject to the exceptions the section lists.
The furnisher's duty. Under 15 U.S.C. § 1681s-2(b), a furnisher that receives notice of a dispute from a bureau must investigate, review the relevant information the bureau sends, and report its results.
The FCRA also reaches who may receive a report. The CFPB notes that the law permits credit reporting companies to provide credit reports only to users who have a permissible purpose listed in the law, and that it has provisions regulating users of reports as well as furnishers. State law may add protections and differs from state to state.
Common Types of Credit Report Errors
These problems usually fall into a few recognizable patterns. The CFPB's list of common errors includes:
- Mixed files. A mixed file is a report that combines two consumers' information in one file, often accounts belonging to someone with the same or a similar name.
- Identity theft accounts. Accounts that appear because someone else used the consumer's personal information.
- Incorrect personal information. A wrong name, phone number or address.
- Duplicate accounts. The same debt listed more than once, possibly under different names.
- Wrong account status. A closed account shown as open, an authorized user reported as the owner, or an account wrongly reported as late or delinquent, or with an incorrect date of last payment, date opened or date of first delinquency.
- Wrong balance or credit limit.
Outdated information is its own category. Under 15 U.S.C. § 1681c(a), a consumer reporting agency generally may not include bankruptcy cases more than 10 years old, measured from the date of the order for relief or adjudication, or accounts placed for collection or charged to profit and loss that antedate the report by more than seven years, a period that begins 180 days after the delinquency that preceded the collection activity or charge-off (15 U.S.C. § 1681c(c)). Civil suits, civil judgments and arrest records may appear for seven years or until the governing statute of limitations expires, whichever is longer, and most other adverse items are limited to seven years, though records of criminal convictions are excepted. Under 15 U.S.C. § 1681c(b), paragraphs (1) through (5) of subsection (a) do not apply to a consumer credit report used in connection with a credit transaction involving, or reasonably expected to involve, a principal amount of $150,000 or more; the underwriting of life insurance involving, or reasonably expected to involve, a face amount of $150,000 or more; or the employment of an individual at an annual salary that equals, or may reasonably be expected to equal, $75,000 or more.
The Dispute Process: What a Consumer May Do Under the FCRA
Disputing with the credit bureau
A consumer may dispute the completeness or accuracy of any item in their file directly with the consumer reporting agency. The CFPB's dispute guidance describes explaining in writing what is wrong and why, including copies of supporting documents, and keeping copies of everything sent. According to that page, the bureau must investigate, forward the dispute and the relevant information to the company that provided the data, and report the results back to the consumer.
The reinvestigation timeline
The timeline comes from 15 U.S.C. § 1681i(a):
- 30 days. The bureau generally has 30 days from receiving the dispute.
- Possible extension. That period may be extended by up to 15 more days if the consumer sends relevant information during the first 30 days, but not if the bureau has already found the item inaccurate, incomplete or unverifiable.
- Notice to the furnisher. Within five business days of receiving the dispute, the bureau must notify the furnisher.
- Frivolous or irrelevant disputes. If the bureau reasonably finds a dispute frivolous or irrelevant, including for lack of sufficient information, it may stop, but it must notify the consumer, with its reasons, not later than five business days after making that determination.
- Correction. Items found inaccurate, incomplete or unverifiable must be promptly deleted or modified.
Disputing with the furnisher
A consumer may also dispute with the furnisher. Under 15 U.S.C. § 1681s-2(a), a furnisher notified at its specified address that specific information is inaccurate may not keep reporting it if it is, in fact, inaccurate, and the CFPB states furnishers generally must investigate and respond within 30 days. Under 15 U.S.C. § 1681s-2(c), sections 1681n and 1681o generally do not apply to a violation of subsection (a) of that section, which under 15 U.S.C. § 1681s-2(d) is enforced exclusively by the Federal agencies and officials and the State officials the FCRA identifies.
Getting the reports
Free reports come through AnnualCreditReport.com, which the FTC describes as the only authorized site for the free annual reports.
When the FCRA's Civil Liability Provisions May Apply
Many people reasonably wonder whether a bureau that "verifies" an error twice has simply won. Federal law gives a consumer the right to bring a civil action against a person who fails to comply with the FCRA, and the CFPB's summary of rights notes this reaches consumer reporting agencies and, in some cases, users of reports and furnishers.
Willful noncompliance. 15 U.S.C. § 1681n makes potentially available actual damages sustained as a result of the failure, or damages of not less than $100 and not more than $1,000 (for a natural person who obtains a consumer report under false pretenses or knowingly without a permissible purpose, actual damages or $1,000, whichever is greater); punitive damages in an amount the court may allow; and, in a successful action, costs and reasonable attorney's fees as the court determines.
Negligent noncompliance. 15 U.S.C. § 1681o makes potentially available actual damages sustained as a result of the failure and, in a successful action, the same costs and fees. Both sections also let a court award fees against a party who files a paper in bad faith or to harass.
What must be shown. Each remedy depends on proving a failure to comply, the required level of fault, and, for actual damages, harm caused by that failure. A bureau's or furnisher's conduct, such as reporting information without reasonable procedures or without a reasonable reinvestigation, may violate the statute, but whether a particular situation does depends on its facts.
Time limit. Under 15 U.S.C. § 1681p, an action must be filed by the earlier of two years after the plaintiff discovers the violation or five years after it occurs, in a federal district court or another court of competent jurisdiction. More on consumer lawsuits under federal law.
Related Issues This Page Does Not Cover
Credit report problems often sit next to other topics that this page does not address in depth:
- Security freezes and identity theft recovery. The CFPB's summary of rights states that identity theft victims have additional rights, and the FTC points people who suspect misuse of their personal information to IdentityTheft.gov. This page does not describe those additional rights.
- Debt collection. When a reported item comes from a collection agency, the Fair Debt Collection Practices Act may also be relevant. The FDCPA is a separate federal law with its own text.
- Credit repair services, debt settlement, bankruptcy, or whether any debt should be paid.
- State consumer reporting laws, which differ from state to state.
For a broader overview, see this site's consumer rights law overview.
How This Site Works and What to Expect
Federal Consumer Rights is a website that provides information and facilitates inquiries concerning consumer-protection matters. It is not a law firm and does not represent anyone. When a reader sends a request for a case review through this site, that request may be passed to attorneys who decide for themselves whether to respond.
Records that bear on a credit report dispute include the credit reports showing the error, any dispute letters and their delivery dates, the responses received, and any denial or adverse action notice. The CFPB's summary of rights states that anyone who uses a consumer report to deny an application for credit, insurance or employment must say so and give the name, address and phone number of the agency that supplied it.
Requesting a Consumer Rights Case Review
Credit report cases turn on sequence and records: which bureau or furnisher reported the item, what the dispute said and when it arrived, what came back, and what happened after, such as a denial or a higher rate. This page explains federal law only and does not cover credit repair services, debt settlement or any state's own reporting rules. A consumer rights case review may be requested through Federal Consumer Rights.
