If a credit reporting agency unfairly refuses to correct a mistake, can you sue?

Yes, most courts have held that the Fair Credit Reporting Act (FCRA) enables individuals to sue. In the law, this is called a private right of action. In order to make a claim under the FCRA, a consumer must establish the following factors:

1. The inclusion of inaccurate information in the credit report;

2. the inaccuracy caused by the consumer reporting agency's failure to follow reasonable procedures to assure accuracy;

3. injury;

4. the injury caused by the inaccuracy of the credit report.

Can companies purchase copies of credit reports?

Yes, but the FCRA imposes requirements on those who purchase credit reports. The law provides:

A person may not procure a consumer report for purposes of reselling the report (or any information in the report) unless the person discloses to the consumer reporting agency that originally furnishes the report:

(A) the identity of the end-user of the report (or information); and

(B) each permissible purpose under section 604 [ยง 1681b] for which the report is furnished to the end-user of the report (or information).

How long does negative information stay on my credit report?

Negative information does not stay on your credit report for life. Most information must be removed after seven years. However, records of bankruptcies can be reported for 10 years.

What is credit insurance?

Credit insurance is insurance bought that pays off the balance of a loan if you become disabled and cannot work to earn money to pay back the money you borrowed. There are different types of credit insurance, including credit life insurance, credit health insurance, and credit disability insurance. If a person does not have life insurance, credit insurance may be a good purchase, particularly the type that will pay off a loan in case of your death.

What is identity theft?

Identity theft, the fastest growing crime in America, refers to someone else committing fraud by using your account information or stealing your identity to make monetary purchases. There are different types of identity theft. For example, if someone steals your credit card or writes down your credit card number, they may commit fraud by using that card to make purchases.

At other times someone calls your credit card company with your credit card number and makes a change-of-address. They then have the statements billed to this new address and begin using your card in this manner. To help detect these unauthorized change of address requests, many financial institutions mail a change of address notification or confirmation to the original (old) address after they receive a change of address request. Make sure to read all notifications sent to you by your financial institutions carefully, and contact your financial institutions immediately if you believe any unauthorized or fraudulent activity may have occurred or been attempted regarding one of your accounts.

Perhaps the most common type of identity theft occurs when someone pretends to be you and opens up new accounts in your name. They may start credit card accounts, cell phone accounts, checking accounts and other accounts that are simply not yours.

How can you protect yourself from identity thieves?

You have to jealously guard your personally identifiable information. This includes your social security number, your credit card numbers, and your bank account numbers. Do not allow people untrammeled access to your personal computer, as that might become a classic gateway for the predatory identity thief. Realize that some identity thieves are relentless in their quest for other people's personally identifiable information. When you throw away credit card receipts and bank receipts, make sure that they are fully shredded. Some identity thieves even "dumpster dive" (actually physically go through other people's trash) to find key information.

Another tip is to ask why someone needs your social security number. Someone could be asking for an improper purpose. Another safety measure is to follow up if you don't receive a monthly bill from a creditor. While a natural impulse may be to not worry about receiving a bill, it could signify an attempted account takeover by an identity thief who has made a fraudulent change-of-address to take over your account.

Also, never keep your account passwords and pin numbers written down near your actual cards. That may be the ultimate faux pas. Don't make it easy for identity thieves.

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