A consumer credit report is a factual record of the payment history of an individual credit. It is provided for a purpose permitted by law: to help a credit granter or lender quickly and objectively decide whether to grant credit. Most of the information in consumer credit reports comes directly from companies that a person does business, but also some information comes from public records. Credit reporting can be helpful in extreme cases, but is often undermined by collection agencies trying to sell their services. When a collection agency reports the delinquent account to a credit bureau, which receives no money from the business today. What it does is provide a “wish” to pay for an unknown time in the future if the debtor ever has to make a financial transaction that involves a creditor that checks your credit report to consumers. The point is that reporting Credit can also create an obligation for businesses because of collection agencies accounts reporting that were not valid debts. This can open the business to legal action – something no businesses needs.
Estimated it has more than 41% of the information contained in consumer credit reports is not accurate, and identity theft on the rise, the company should proceed with caution when considering credit reporting. The Fair Credit Reporting Act regulates the activities of credit reporting agencies. A credit reporting agency under this Act, any person or company that assembles or evaluates consumer credit information in order to provide consumer credit reports to third parties. Under the law of consumer credit report, here are some elements that can not be mentioned in consumer credit reports: A discharge or final order in Bankruptcy Court dated more than 10 years before the date of credit report to consumers. Lawsuits and judgments entered more than seven years before the date of the report consumer credit. Paid tax liens which, from the date of payment, precede the report by more than seven years.
Accounts placed for collection or charged to profit and loss by the creditor that date back more than seven years before the credit report. Records of arrest, indictment or conviction for a crime that, from the date of disposition, release, or parole, precede the report by more than seven years. All adverse information that precedes the report of more than seven years. Default information concerning U.S. Government insured or guaranteed student loans can be reported for seven years after the debt collection actions taken against certain guarantors. There are three major credit bureaus: Equifax, Experian, Trans Union. Federal law specifies how long negative information may remain in the credit report of a person. This includes late payments, accounts that the credit granter turned over to a collection agency and judgments filed against a person in court – even if later the account was paid.