Can I Dispute Information in My Credit Report?

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• Reports Can Only Be Furnished for a Permissible Purpose
• Information That Must Be Excluded From the Credit Report
• CRA Procedures Should Avoid Errors
• Reinvestigation Required in Cases of Credit Report Errors

Consumer reporting agencies (CRAs) have certain requirements under the Fair Credit Reporting Act (FCRA). Failure to follow those requirements could be a violation of the FCRA, and if that violation injures a consumer, the CRA may be liable to the consumer for damages. The CRA (e.g. TransUnion, Experian, Equifax) can be in violation of the FCRA for several reasons, including:

• listing information that is required to be excluded under the law
• failure to furnish a consumer report for a permissible purpose
• failure to follow reasonable procedures to assure maximum possible accuracy of the consumer’s information contained in their credit file
• failure to conduct proper reinvestigation

Reports Can Only Be Furnished for a Permissible Purpose

The CRAs provide credit reports to “users” of the information. Users are typically credit card companies, insurance companies, employers, etc. But, those users must promise to the CRA that the information will only be used for a “permissible” purpose, which generally include:

• Offering credit
• Collection of an account
• Employment
• Insurance underwriting
• Legitimate business need

Employment background checks will require written authorization from the consumer. But often consumers implicitly give permission to pull their credit, like when they are applying for a loan. Many users do not need express permission to pull a consumer’s credit report, as in the case of a debt collector.

Information That Must Be Excluded From the Credit Report

The federal law requires certain information be excluded from a consumer’s credit report after a period of years. Consumer bankruptcies can be reported for 10 years. The maximum reporting time is seven years for most other negative information, which includes:

• Civil suits, judgments, and records of arrest
• Paid tax liens
• Credit accounts placed for collection or charged to profit and loss
• Any other adverse item of information

CRA Procedures Should Avoid Errors

It is not necessarily a violation of the FCRA if a CRA inaccurately reported consumer information. CRAs are evaluated for their “procedures.” Those procedures must be reasonable and designed to avoid violations of the law. For example, CRAs must maintain reasonable procedures to avoid violations on listing information that is required to be excluded under the law and furnishing consumer reports for permissible purposes.

Material errors made by the CRAs can lead to a decrease in a consumer’s credit score. Those types of errors include:

• Error in reporting late of missed payments
• Error in reporting amount of derogatory public records
• Error in reporting accounts to collection
• Error in reporting inquiries for new credit
• Duplicate entries of the same information
• Dormant account shown as active when consumer had requested closed

Reinvestigation Required in Cases of Credit Report Errors

If a consumer notifies the CRA that the completeness or accuracy of any item of information contained in a consumer’s file is disputed by the consumer, reinvestigation by the CRA is required. In that dispute process, a CRA must:

• Assess no cost to consumer
• Conduct a reasonable reinvestigation
• Determine whether the disputed information is inaccurate
• Consider all relevant information submitted by the consumer in its reinvestigation
• Notify the “furnisher” of the disputed information
• Record the current status of the disputed information or delete the item
• Complete within 30 days from the date it receives notice of the dispute from the consumer

If, after the reinvestigation, the negative information remains in your credit file, you will be notified and provided an opportunity to obtain a free copy of your credit report. If a consumer is concerned that a credit reporting agency did not maintain proper procedures or has denied a request to remove information requested by the consumer, the consumer should discuss these concerns with an experienced Colorado consumer law attorney. For more information on this area of law, see our overview of consumer law.