Question. Where can I find the law on factual errors? And what is actually called a factual error? And if I do find an error do they have to delete it from the report or they can just fix it? Thank you very much you have helped so many people. You know what that means? No good deed goes unanswered.
Answer: The Fair Credit Reporting Act (FRCA) says the information on your credit reports must be accurate.
§ 602. Congressional findings and statement of purpose
(a) Accuracy and fairness of credit reporting. The Congress makes the following findings:
(1) The banking system is dependent upon fair and accurate credit reporting. Inaccurate credit reports directly impair the efficiency of the banking system, and unfair credit reporting methods undermine the public confidence which is essential to the continued functioning of the banking system.
The Fair Credit Reporting Act is a lengthy document but it is worth reading over and over again. Each time I look at it I see something new that can be applied toward credit repair.
Factual Disputes. When I speak of factual disputes I am in part referring to FRCA Section § 602 above. Any information that is inaccurate in your credit report is not a factually based entry. Only true and correct facts should be in your credit report, if not, inaccurate information is being reported.
Consumers engaging in credit repair mainly dispute all negative information, whether the information is correct or not, in the hopes it will not be verified and thus deleted from your credit report. Sometimes this tactic works. But often times the creditor verifies the information as accurate which may lead to the credit bureaus rejecting further disputes for up to 12 months because the disputes are labeled “frivolous”.
Factual disputes give consumers a greater chance at having their disputes taken seriously. If disputes are factual and the credit bureaus refuse to delete them, they are in violation of the FRCA. Once you identify a violation you've got some leverage on your side.
Correction or Deletion. You asked if an error is found does it have to be deleted or corrected? It really depends on what you ask for and how the credit bureaus will respond if they have updated information. There are no laws that require a credit bureau to delete negative information if that information is accurate. I always suggest requesting deletions because “corrected” negative information will likely do nothing for your credit scores. However, if you request a deletion of the entire account then that may help your credit scores.
Examples of Factual Disputes.
- Incorrect account numbers
- Incorrect balance
- Incorrect opening date
- Incorrect credit limit
- Incorrect account type
- Charge off that has been sold or transferred has past due balance instead of zero balance
- Charge-off account showing currently past due
- Open charge-off accounts
- Accounts not included in bankruptcy
- Collection accounts with a credit limit
You see where I am going with this. You have to carefully review your credit report to find factual errors. Your goal is to get negative information deleted, not corrected. Always request a deletion of negative information. There is no guarantee that you will get it, the information may be corrected and/or verified as accurate.
Consumers can request a re-investigation of disputed item. Engaging in credit repair may take extra steps. Just because a credit bureau investigated an item and supposedly resolved the matter, does not mean the results are accurate.
Consumers should take advantage of FRCA, § 611. Procedure in case of disputed accuracy
(a) Reinvestigations of Disputed Information:
“(A) In general. Subject to subsection (f), if the completeness or accuracy of any
item of information contained in a consumer's file at a consumer reporting
agency is disputed by the consumer and the consumer notifies the agency
directly, or indirectly through a reseller, of such dispute, the agency shall,
free of charge, conduct a reasonable reinvestigation to determine whether
the disputed information is inaccurate and record the current status of the
disputed information, or delete the item from the file in accordance with
paragraph (5), before the end of the 30-day period beginning on the date on which the agency receives the notice of the dispute from the consumer or reseller.
(5) Treatment of Inaccurate or Unverifiable Information
(A) In general. If, after any reinvestigation under paragraph (1) of any
information disputed by a consumer, an item of the information is found to
be inaccurate or incomplete or cannot be verified, the consumer reporting
(i) promptly delete that item of information from the file of the consumer, or modify that item of information, as appropriate, based on the results of the reinvestigation; and
(ii) promptly notify the furnisher of that information that the information has been modified or deleted from the file of the consumer.
I would invite you to read the entire Section 611 of the Fair Credit Reporting Act as it contains several key remedies and procedures for consumers requesting Reinvestigation of previously disputed items which could help you if a dispute is verified as accurate by a creditor.
Using factual credit disputes gives consumers more leverage as it is hard to verify a fact as accurate when it is not. Good luck to you.