Debt and credit issues could severely affect someone’s financial life to the extent that filing for bankruptcy might provide the only solution. Minnesota residents might feel relieved to know that federal laws related to bankruptcy protections and credit reporting exist. The Fair Credit Reporting Act (FCRA), in particular, promotes accuracy regarding someone’s credit history. An inaccurate credit report could cause many problems since false information might create an equally false impression. The regulations present under this law might deliver much-needed assistance to those attempting to fix their financial affairs.
Taking advantage of the FCRA
Originally signed into law in 1970, the FCRA affects how the three main credit reporting agencies operate. Many people likely realize this, but they might not know that other entities, such as banks and those involved with medical records, must follow the rules stipulated under the law.
Among the most helpful benefits the law provides is the ability to access records. The FCRA allows people to request a free copy of their credit report from the three agencies at least once a year.
Equally beneficial are the protection clauses under the law. That is, only those with a “need to know” may review a credit report. Banks may look at the credit report when someone tries to take out a loan, for example. “Random eyes” cannot look at a credit report without someone’s permission.
Correcting mistakes on a credit report
A credit report could contain information about previous bankruptcy filings or current borrowing status. Mistakes happen, and not all the information might be correct. The FCRA makes it possible for someone to dispute inaccurate information.
A credit agency has to remove inaccurate information. The person adversely affected must notify the agency and provide necessary proof that the information is not correct. Removing false information might improve a credit report significantly.