Legal Representation for Fair Credit Reporting Act Claims in Los Angeles

Misuse and misreporting of debtor’s credit information can result in lower credit scores, higher interest rates on loans, and denial of credit. The Fair Credit Reporting Act (FCRA, 15 U.S.C. 1681) protects California consumers from the misuse of credit-related information, giving them rights to fair and accurate reporting and privacy rights. It governs the behavior of consumer reporting agencies and any businesses that report to consumer reporting agencies.

FCRA Violations Related to Bankruptcy

Creditor reporting agencies and businesses that give them information are required to keep your credit information current and accurate. Failure to do so can be a violation of FCRA. An example is if a business fails to report that a judge discharged your debts in bankruptcy. Bankruptcy is supposed to give you a fresh start, but failing to follow the FCRA may result in this fresh start not being possible. Credit reporting agencies may not act in your best interests, unfortunately, without pressure from an experienced attorney.

Any debts that are settled through negotiation before bankruptcy or that were paid off through bankruptcy must be reported accurately. The creditor is not permitted to report these types of debts as charged off. Further, the creditor may not misstate the balance due or report you paid late if you paid timely.

It may seem obvious, but you should make sure all your debts are accurately reported before and after bankruptcy. It is not uncommon for false items to appear in your credit card statement or for other mistakes to be made by a credit reporting agency. If you submit a written letter disputing the accuracy of a charge or debt, the relevant creditor should perform a reasonable investigation about the dispute and correct any inaccuracies. If appropriate, the creditor will need to remove the disputed debt. If a credit agency fails to tell a creditor that you have disputed a debt, or fails to claim an inaccuracy within 30 days, it is violating the FCRA.

Another crucial piece of information about the FCRA is that a credit reporting agency can only release your credit information to someone who has a valid need and permissible purpose. For example, it would be appropriate to release it to a creditor, landlord, or utility company who needs to know you have good credit before giving you an account. Improper purposes include someone looking at your credit report to determine whether to file a lawsuit for a slip and fall, or a creditor checking on your financial activity after your debt was already discharged in bankruptcy.

The FCRA also provides detailed notice requirements. A creditor must notify you if it supplies negative credit information to a credit reporting agency. A prospective lender must notify you if there was a decision not to make a loan based on your credit report. Creditors also must notify you that you have the right to get a free credit report and identify the source of credit information obtained about your credit. If they fail to follow any of the detailed FCRA rules, and as a result you are experiencing negative decisions from lenders or getting harassing phone calls, it may be appropriate to file an FCRA lawsuit in addition to bankruptcy.

A Los Angeles Bankruptcy Attorney Will Help You Navigate The FCRA