How Private Is My Credit Report?

How Private Is My Credit Report?

Copyright 1992, 1993, 1994 Center for Public Interest Law

Credit reports are a gold mine of information about consumers. They contain Social Security numbers, addresses, credit payment status, employment, even legal information. To address concerns about who has access to this potentially sensitive information, California recently passed a law which enhances consumers' privacy rights. The credit bureaus have also adopted voluntary guidelines to improve consumer services.

**What is in my credit report?**

Your credit report is actually a credit history. It is created by reports from many different sources. Firms which have granted you credit make regular reports about your accounts to the credit bureaus. If you are late in making payments, those to whom you owe money such as utilities, hospitals, landlords and others may report this information to the credit bureaus. Your bank may also inform the credit bureaus if you overdraw your account.

In addition, your credit report contains your name and any name variations, your address, Social Security number and employment information. Your legal record may also be included in your credit report, including marriage, divorce, liens, bankruptcy and other matters of public record.

**Is there anything that cannot be in my credit report?**

Certain pieces of personal information cannot be in your credit report:

Medical information (unless you give your consent). Adverse information, including bankruptcy, that is more than 10 years old. Debts that are more than seven years old. If the report has been requested by a prospective or current employer, information about age, marital status, or race cannot be included.

Who has access to my report?

Anyone with a "legitimate business need" can gain access to your credit history, including:

Those considering granting you credit. Landlords. Insurance companies. Employers and potential employers.

Some companies known as information brokers or "super bureaus" buy credit reports in bulk and then re-sell them. Super bureaus are regulated by California credit reporting laws and must tell the credit bureau who is the ultimate recipient of the file. This is to make sure the report is used for permissible purposes.

Your credit report is also used for marketing purposes. Credit bureaus frequently release information from individual credit files to companies that offer "pre-approved" credit cards or other lines of credit. In California any company which accesses your credit report to obtain information in order to solicit offers of credit must disclose that practice to you; the company must also notify you of your right to prohibit further such use of your credit report. See below for the telephone numbers to call to be removed from these lists. (See also Privacy Rights Clearinghouse Fact Sheet No. 4, "Junk Mail: How Did They All Get My Address?")

Federal and state laws provide consumers with these privacy rights:

California law requires credit bureaus to allow you to "opt out" of pre-approved credit offers. The credit bureaus must provide a toll-free number you can call to ask to be removed from these lists. You may also notify the credit bureaus in writing. To have your name removed from lists sold to credit grantors and marketers, contact the three major credit reporting companies as follows:

TRW Telephone: (800) 353-0809 Mail Preference Service, 701 TRW Parkway, Allen, TX 75002.

Equifax Options Telephone: (800) 219-1251 Marketing Decision Systems, P.O.Box 740123, Atlanta, GA 30374-0123.

Trans Union Telephone: (800) 241-2858 555 West Adams St., 8th Floor, Chicago, IL 60661.

State law also says that if your credit report is used for employment purposes, you must be notified in writing and offered a free copy of your report.

You have the right to know who has inquired about your credit file or requested your report over the last six months. Inquirers' names are listed on your credit report.

In California, if you have voluntarily closed a credit card account, your credit report must indicate the fact that the account was closed *by the consumer*.

How can I find out what is in my credit report?

At your request, credit bureaus must provide you with a copy of your own credit report. You can obtain a copy of your credit report by contacting each of the three major credit bureaus: TRW, Equifax and Trans Union.

TRW will give you one free copy of your credit report per year. There may be a fee for ordering your report from Equifax and Trans Union. However, California law requires the charge to be no more than $8. If you have been denied credit based on information in your report, the credit bureau must provide you with a free copy upon request.

To find out how to obtain a copy of your report call:

TRW (800) 392-1122

Equifax (800) 685-1111

Trans Union (800) 851-2674

After the credit bureau receives your request, California law requires it to mail a copy of your report to you within five working days.

**How will I know if there is negative information in my report?**

In the past if your credit report contained negative information, you probably would not find out about it until you were turned down for credit or ordered a copy of your report. Now, a new state law requires that creditors tell you before putting negative information into your file. After you have been notified, however, the creditor may report additional negative information about that transaction or line of credit without giving you any further warning.

If you disagree with a creditor's report of negative information, the creditor must put a notice of that dispute in your file, before reporting to the credit bureau.

**What can I do if there are errors in my report?**

Credit bureaus are regulated under the California Consumer Credit Reporting Agencies Act (California Civil Code section 1785 et. seq.) and the federal Fair Credit Reporting Act (15 USC 1681 et. seq.). These laws specify that you have a right to have errors corrected. National credit bureaus must have a toll free number for you to contact them with your questions. Also, credit reports must provide an address to request an investigation of inaccurate information.

Once you have notified a credit bureau of your dispute, California law allows 30 business days for an investigation. The bureau must consider all the relevant evidence you give it, and errors must be corrected. If you ask the credit bureau to do so, it must send a corrected report to anyone who has requested your file in the past six months and to anyone who has requested it in the last two years in relation to employment.

If you disagree with the result of the credit bureau's investigation, you have the right to submit a 100-word explanation of the discrepancy. The credit bureau must include that information in your file.

Some consumers who have had errors corrected find the incorrect information reappears in their files at a later date. California law requires credit bureaus to notify the consumer within five days of reinserting the information. Credit bureaus must provide the subject of the report with a toll free number to dispute the reinsertion, and the opportunity to include a dispute statement. However, even if you have had errors in your report corrected, it is wise to periodically check your credit report to make sure the errors do not reappear.

**Can I have negative information deleted if the entry is not an error?**

Negative information in your credit report usually can be removed only by maintaining a good credit record over a number of years. Companies or individuals promising quick fixes are almost always fraudulent.

For help with re-establishing good credit, the Consumer Credit Counseling Service may be able to assist you. This nonprofit group has offices in most cities. To find the office nearest you, call (800) 388-2227.

Beware of other credit repair services. Generally they promise a lot, charge a lot and deliver very little.

**What is the difference between a credit report and an investigative consumer report?**

Some credit bureaus and "super bureaus" conduct investigative consumer reports which are much more detailed than credit reports. Among those using these reports are insurance companies, employers and landlords. Investigative reports can contain information on your character, reputation, personal characteristics and life style. This information may be gathered through personal interviews with neighbors, friends, associates or acquaintances, as well as a search of public documents such as property and court records.

Because the information in these reports is so detailed and may be sensitive, both federal and state law impose stricter regulations on credit bureaus which compile investigative reports (California Civil Code 1786 et. seq.; 15 USC 1681d). An investigative consumer report can only be used in limited circumstances including employment, insurance and rental housing decisions. This type of report cannot be used to grant credit.

The law requires the requester of the report to inform the subject that an investigative consumer report will be made. However, there are times when an employer does not have to tell an employee he or she is the subject of an investigative report. This includes when the report is to be used to consider promoting or firing an employee, or when an employee is being investigated for possible criminal activities.

You have the same rights to correct and dispute incorrect or incomplete information in an investigative report as you have in a credit report.

**For more information**

For in-depth information on credit and banking, contact the organizations listed below. They have developed several informative brochures on these topics.

Bankcard Holders of America, 560 Herndon Parkway, Suite 120, Herndon, VA 22070. (703) 481-1110.

Consumer Action's Credit and Finance Project, 116 New Montgomery St., Suite 223, San Francisco, CA 94105. Complaint Referral Hotline (415) 777-9635. (TDD/voice (415) 777-9456).

Federal Trade Commission, Public Reference, Washington D.C. 20580 (request the FTC's publications order form).

For assistance in re-establishing good credit, contact the **Consumer Credit Counseling Service** at (800) 388-2227.

California Civil Code section 1785 et. seq. contains the **California Consumer Credit Reporting Agencies Act**. California Civil Code section 1786 et. seq. contains the California Investigative Consumer Reporting Agencies Act. Federal law 15 USC 1681 contains the **Fair Credit Reporting Act**.

For more information on credit and other privacy-related issues, contact the *Privacy Rights Clearinghouse* hotline at (800)773-7748.

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The Privacy Rights Clearinghouse is a nonprofit consumer education service funded by the California Public Utilities Commission through its Telecommunications Education Trust. It is administered by the University of San Diego School of Law's Center for Public Interest Law. * * * * * * * * * *

This fact sheet should be used as an information source and not as legal advice. Privacy Rights Clearinghouse materials are designed primarily for California residents. Laws in other states may vary.

************************************** The Privacy Rights Clearinghouse
The Center for Public Interest Law
5998 Alcala Park
San Diego, CA 92110
(619)260-4806
(619) 260-4753 (fax)

This copyrighted document may be copied and distributed for nonprofit, educational purposes only. The text of this document may not be altered without express authorization of the Privacy Rights Clearinghouse.