Credit reporting and your credit scores

It is essential for every consumer to have a proper knowledge of credit reporting and credit scores. In order to safeguard your privacy it becomes very important to order your credit report once every year and to be aware of the credit reporting and other rights. The Federal Fair Credit reporting Act (FCRA) and laws of the state restrict the access to the sensitive information about credit and the used that can be made out of it. Under the credit reporting rights you can:

• Obtain a copy of your credit report. You are entitled to get a free copy of the report every year.
• You have the right to know who has got a copy of your credit report for verification.
• You can explain the circumstances even if any negative information has been included in it.
• You can very well “opt out” for stopping the credit bureaus from using your details for marketing.
• As a consumer you have the right to make complaints to the required government agency or file a case/lawsuit.

There are some credit reporting agencies and investigation companies that compile ‘investigative consumer reports’ and under the Fair Credit Reporting Act these reports are defined as a report in which information on the character of a consumer, personal characteristics, general reputation or mode of living is obtained through personal interviews with associates, friends and neighbors. There are some credit reporting laws as well:

• There are several methods of raising your credit score. But before doing that you need to be aware of certain facts related to the score:

• Your credit scores will not get affected adversely if you check your credit report on a regular basis.

• If you close some of your accounts then it will in no way improve your credit report score.

• You need to just check your FICO score rating.

• If you undergo credit counseling then it will not affect your credit score.

So make sure that you are well aware of the laws and rights under credit reporting and credit scores so that you do not fall in the trap of scams and identity theft.