Understanding the Fair Credit Reporting Act (FCRA): How to Fix and Remove Inaccurate Items from Your Credit Report

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The Fair Credit Reporting Act (FCRA) is a landmark federal law that governs how credit information about consumers is collected, shared, and used in the United States. Enacted in 1970, the FCRA was designed to protect consumers from unfair credit reporting practices and ensure that the credit information used to make lending and employment decisions is accurate, fair, and private.

How to Fix and Remove Inaccurate Items from Your Credit Report

Purpose of the FCRA

The main purpose of the FCRA is to promote accuracy, fairness, and privacy within the consumer credit reporting system. Congress recognized that the U.S. banking and financial system depends on fair and accurate credit reporting — and that consumers must be protected from errors, outdated information, or misuse of their personal data.

In simple terms, the law ensures that:

Only those with a legitimate reason (“permissible purpose”) can access your credit report.
You have the right to know what’s in your credit file.
You can dispute inaccurate or unverifiable information.
Outdated negative items must be removed after specific time periods.

Function of the FCRA

The FCRA assigns responsibilities to three main groups:

Consumer Reporting Agencies (CRAs) such as Equifax, Experian, and TransUnion.
Furnishers — companies that provide data to CRAs (like banks, lenders, or collection agencies).
Users — entities that access your report for credit, insurance, housing, or employment purposes.

Key Functions of the FCRA:

Regulates Access to Data: Only those with a “permissible purpose” may access your report (e.g., lenders, employers with written consent, or insurers).
Ensures Accuracy: CRAs and furnishers must use reasonable procedures to ensure maximum possible accuracy.
Grants Consumer Rights: You’re entitled to one free credit report each year and can dispute incomplete or inaccurate information.
Sets Time Limits: Most negative data must be deleted after 7 years (10 years for bankruptcies).
Requires Adverse Action Notice: If credit, insurance, or employment is denied because of your report, the company must inform you and identify the CRA used.
Enforces Privacy: Your data cannot be shared without your consent or a legal purpose.
Provides Legal Remedies: You can sue violators for damages under the FCRA.

Key FCRA-Related Laws by Credit Category

Here’s how different areas of your credit file are governed by the FCRA and related U.S. Code sections:

1. Late Payments

15 U.S. Code § 1681a(2)(Xi) and 15 U.S. Code § 1666b
These sections outline how creditors must report and apply payments accurately. A payment cannot be reported as “late” if it was received by the due date (accounting for processing time). Misreported late payments can be disputed and deleted if unverifiable.

2. Medical Bills

15 U.S. Code § 1681b(a)(2)
Limits who can access and report medical information. Medical debts must be reported accurately and often require consumer consent before disclosure. Many medical collections are now removed after being paid or after one year of being reported.

3. Collections Accounts

15 U.S. Code §§ 1692c, 1692g, and 1681e(b)
These sections govern debt collectors. They must verify the debt upon request (1692g) and cannot report unverifiable or inaccurate debts to CRAs (1681e(b)). You can demand validation of debt before it appears on your report.

4. Repossessions

15 U.S. Code § 1681b(a)(2)
Authorizes credit reports to include repossession details only when legally verifiable. Inaccurate or unverified repossessions can be disputed under FCRA.

5. Child Support

15 U.S. Code §§ 1681b and 1681s-1
Child support obligations can appear on credit reports if reported by authorized state agencies. Errors must be corrected promptly under FCRA rules.

6. Evictions

15 U.S. Code §§ 1637(2)(9A), 1681, and 1681s-2(a)(3)
These sections regulate tenant-screening reports. Landlords and agencies must ensure eviction data is accurate and not outdated (typically more than seven years old).

7. Charge-Offs

15 U.S. Code §§ 1635 and 1692g
A charge-off is when a creditor writes off your debt as a loss. However, if the balance, dates, or account ownership are inaccurate or unverifiable, you can request validation and deletion under FCRA dispute rights.

How to Legally Remove Inaccurate, Outdated, or Unverifiable Items

Removing inaccurate items from your credit report is your legal right under the FCRA. Here’s how to do it correctly:

Step 1: Obtain Your Credit Reports

Visit AnnualCreditReport.com to get free reports from Equifax, Experian, and TransUnion.

Step 2: Review for Errors

Look for:

Misspelled names or incorrect addresses
Accounts that don’t belong to you
Outdated negative items (older than 7 years)
Duplicate collections or inconsistent balances

Step 3: Dispute Inaccurate or Unverifiable Information

Submit written disputes directly to each credit bureau. Include:

A clear explanation of the inaccuracy
Supporting documentation
Your name, address, and report reference number

The bureau must investigate within 30 days and remove unverifiable or inaccurate data.

Step 4: Follow Up with the Furnisher

If the furnisher (e.g., creditor or debt collector) continues to report incorrect information, send a direct dispute citing your rights under 15 U.S. Code § 1681s-2.

Step 5: Escalate if Necessary

If errors are not corrected:

File a complaint with the Consumer Financial Protection Bureau (CFPB).
Consider consulting a credit repair or legal professional.
You may also sue violators for damages under FCRA § 1681n (willful noncompliance).

Final Thoughts

The Fair Credit Reporting Act empowers you to control what appears on your credit report and ensures that no company can legally report false, outdated, or unverifiable information about you. Understanding these rights allows you to protect your financial reputation, improve your credit score, and hold reporting agencies accountable.

Maintaining your credit health is not just about paying bills — it’s about making sure your report tells the truth about your financial history.

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