One of your most valuable assets is your credit record. Our economy and much of our personal lives depend on being able to borrow sums at reasonable rates and loss of that asset can not only be expensive for you and your business…but can eliminate many of the economic opportunities that otherwise would be available.

Consider: personally, credit is not only “convenient” for the purposes of having credit cards, but vital if you wish to own a home or even lease one. Credit is essential for most of the basics of life and business: from owning an automobile to renting a vehicle, from borrowing money for starting a business or buying a computer to allow you to communicate with customers.

Yet many people do not understand that protection of this critical asset requires not only prompt payment of bills on time but guarding oneself against the often erroneous and at times vindictive misreporting of one’s credit history. It takes seven to ten years to eliminate the effect of most bad credit reports. Sometimes longer. The intelligent business person will know his or her rights to protect his or her credit and guard them jealously.

This article shall discuss the basic rights one has under United States Federal Law.



The Fair Credit Reporting Act (FCRA), a federal law, was created to help protect the privacy of information in the files and reports that are created by each "consumer reporting agency" (CRA). This information shows whether or not you pay your bills on time, what credit accounts you have open or closed, and your long term payment history. In addition the report provides personal information including social security number, address, phone number and place of employment.

If you apply for a credit card, bank or other loan, or seek housing through rental, those you apply to will need to see your report. If you seek bank financing to start your business or through the SBA, you can expect a CRA to be consulted. Indeed, such information is easily obtained by attorneys and any and all law enforcement agencies which, in turn,often make such information available to other agencies or to their clients. The CRAs, in effect, are your written “financial reputation” resource and that information is a permanent record consulted by those with whom you may wish to establish a business or financial relationship in any manner.

The FCRA gives you specific rights, the vital ones which are outlined below. You may have additional rights under state law depending upon which state you reside in or your business operates in but assuming the credit information relates to interstate commerce in any way (and almost all does) the federal law described here will certainly apply.


Questions and Answers:

1. Can I get a copy of my credit report to see what information is in there?


You can order a copy of your credit report, either via phone or online, from the three main Credit Reporting Agencies (CRA’s), Equifax, Experian or Transunion. These “big 3” supply of most of the information to companies or individuals looking to grant you credit. There will be a minimal charge of eight to ten dollars (US) for this report. Note that you are entitled a free copy of your report if;

a. You have been denied credit and request a copy within 60 days of the denial.

b. You are unemployed and will be applying for a job within the next 60 days.


2. What information cannot be reported in my credit report? How long can any information stay on my report?

There are certain pieces of personal information that the law prohibits from being included in your credit report:

a. Medical information (unless you give your consent).

b. Notice of bankruptcy that is more than 10 years old.

c. Outdated information may not be reported. In most cases, a CRA may not report negative

information that is more than seven years old.

d. Age, marital status, or race (if the request is from a current or prospective employer).


Certain kinds of information may remain on your report indefinitely. If, for example, you are applying for credit, insurance or employment above the dollar limits noted below, information can be reported beyond the usual seven to ten year deadlines.

a. A credit transaction involving, or which may be expected to involve, an amount of $150,000 or


b. Information about a job with a salary of more than $75,000.

c. An application for credit or life insurance for more than $150,000.

d. Tax liens that are not paid.


3. Who is allowed to see a copy of my credit report?

Access to your file is limited. A CRA may provide information about you only to people with a need recognized by the FCRA -- usually to consider an application with a creditor, insurer, employer, landlord, or other business. Your consent is required for reports that are provided to employers, or reports that contain medical information. A CRA may not give out information about you to your employer, or prospective employer, without your written consent. A CRA may not report medical information about you to creditors, insurers, or employers without your permission.


4. What can I do if I find information in my report that is wrong or doesn’t belong to me?

You have the right to dispute this information with both the CRA and the source, or creditor who reporting it. It must show on your credit report that an item is being disputed and is under investigation until the claim can be proven true or false. A CRA must remove, or correct, inaccurate or unverified information from its files, usually within 30 days after you dispute it.


5. What can I do if the information is not corrected?

If a CRA, a user, or in certain cases, a provider of CRA data, violates the FCRA, you may sue them in state or federal court. Most law firms will only consider taking cases that have significant financial or emotional injury as a result of negligent and reckless credit reporting practices.


If you can demonstrate that the credit information was intentionally incorrect and you are a business, you also may have causes of action for Intentional Interference With a Business Relationship discussed elsewhere on this website.



Especially for our clients who may not be used to the all pervasive computerization and information technology of the American economy, the power of incorrect information to distort one’s business life can be a shock. One African business man once commented that in his small city his reputation was known by all and if anyone had any questions concerning his past performance of his obligations, they would come to him to discuss it. He shook his head and commented, “Here, unknown people click a mouse and my reputation is sullied for millions of people to see.”

An economy as massive and moving as fast as the United States cannot rely on word of mouth and one can expect that the computerization and impersonalization of credit reporting must spread to the entire world. And that means that each of us and every business has a vital interest in both checking and correcting any misinformation on the world wide credit information reports that are becoming the norm in every economy. It makes sense for every business person, at least annually, to check their credit report and determine its accuracy…for be sure that others will be doing that and you should make sure that there are no unpleasant surprises for them…or you…when they do.