Fair Credit Reporting Act and Bankruptcy

: Reese Baker & Associates

  Filed under: bankruptcy

Your credit rating takes a hit every time you are late or miss payments. These marks stay on your credit report for up to seven years in some cases. If you are hopelessly behind in your payments, you can file bankruptcy, which will stay on your credit report for up to ten years. The significant difference is you will no longer be responsible for the debt if you file bankruptcy.

Credit Rating

Your credit rating is gleaned from information such as how much money you have in your bank or credit union account, how much money you owe and to whom. If you make your payments on time and your place of employment and income, this information is collected and used by prospective lenders to determine if you are a reasonable credit risk.

The three main credit bureaus in the United States are Equifax, Experian, and TransUnion.
These agencies keep consumers’ information in a vast database. They use the information obtained and assign a credit score. A score of 300 is considered a poor rating, and a perfect score is 850. 700 or above, usually indicates good credit.

Consumer Rights

Congress passed the Fair Credit Reporting Act in 1970 to guarantee consumer rights. Some of those rights include:

  • The right to know your credit score.
  • The right to know what is on your credit report.
  • The right to be informed if your credit information is used as a basis for adverse decisions.
  • The right to dispute information on your report.
  • The right to privacy, only revealing your credit information to those with a valid reason to see it.
  • The right to seek damages for violation of your rights.

If you dispute charges on your report, the credit agency must investigate all legitimate claims within 30 days.

If you are behind in your debt and need more information about getting debt relief, contact a Hidalgo County bankruptcy attorney.