CREDIT CONSUMER RIGHTS:
Only of Value If You Know Them and Use Them
Our freedoms and rights make we Americans the envy of the world.
Certain of our rights are high-profile such as those guaranteed in the Bill of Rights. Others, such as the rights of the credit consumer, are not high-profile and most Americans know little, if anything, about them. That’s unfortunate in that for these rights to be of benefit to people like credit consumer, and especially troubled credit consumers, it’s necessary to not only know about those rights, but to take actions on our own if we’re to benefit from them. In other words, the rights are there, but they are useless until the credit consumer takes specific action using the rights.
Life in the United States used to be far more simple when it came to consumerism. Most purchases were made using cash or goods. For the masses of our citizens, only a few, if any, purchases were made on credit. No one had credit, so no one had credit problems or need for credit consumer rights, that simple.
The clouds for the “perfect storm” of credit consumerism started to gather in the late 1950s when the nation’s first general-purpose credit card was launched with a mass mailing of 60,000 credit cards in Fresno, California. The hope, indeed, the plan was to attract customers with a credit line, which would be “revolving,” that is, used for purchases everywhere and paid off over time. This was to feed off the consumer demands of post-war baby boomers.
By the 1970s more than 100 million credit cards were in use, and banks were seeing profits galore from credit consumers. The sheer numbers of credit cards was another factor in the “perfect storm,” but the main factor was the success of the banking industry in eliminating a very critical, consumer-friendly restriction, that being the limit on the interest rate a lender could charge a borrower. That made credit lending far, far more profitable. And thus started to blow that “perfect storm.”
Credit bureaus, the “keepers” of information on consumers, go back to as early as the early 1860s, not just to the years of the “perfect credit consumerism storm,” But, with the explosive growth of the credit and credit card industries, there was an explosion of credit bureau activity as well.
Before the credit bureaus, the small amount of credit granted was based on the merchant’s own knowledge of the customer. The earliest credit bureaus, then, just maintained lists of customers who were considered by the merchants to be poor risks. Later credit bureaus just facilitated the exchange of credit information among merchants. After World War I, credit bureaus expanded to serve a wider audience of geographically wider-spread merchants, providing merchants then with a greater array of information to be used to make decisions of whether to grant credit.
Credit bureaus reacted to the increased credit activity of the “perfect storm” by computerizing their processes and greatly expanding their reach and influence. Not at all surprisingly, as the credit bureaus heightened their levels of activity, they grew into huge bureaucracies second only in size to the federal government. Their motive was profit, and they focused not on the needs of the consumer, but on the needs of their clients, the credit grantors. They cared little that the errors they made in keeping the ever-growing number of credit records hurt consumers because the low credit scores that cost consumers millions of dollars in interest conversely made millions for their clients, the credit grantors. The credit bureaus in turn made huge profits off the credit grantors.
Eventually, though, consumer complaints began to mount at the Federal Trade Commission and offices of state attorneys general. Consumers were finding that they were negatively affected by the credit bureaus, while finding also that they had no way to correct or change their credit information.
In 1971, Congress responded to the needs and demands of the American credit consumer and enacted the Fair Credit Reporting Act (FCRA). Among other things, the FCRA was to ensure that the credit bureaus investigated credit items disputed by consumers. The law set procedural guidelines that gave the consumer the right to challenge the accuracy, validity, and verifiability of credit listings appearing in their consumer credit reports. It also required that the credit bureaus delete any credit listing if it was inaccurate or could not be verified. Congress told the credit bureaus via the FCRA that they were to have responsibility to the consumer, and not just to their clients, the credit grantors.
The Fair Credit Reporting Act of 1971 with subsequent amendments, along with the Fair and Accurate Credit Transactions Act of 2003 (FACTA), exist to give credit consumers valuable rights in protecting themselves against abuse by the powerful credit bureaus and other credit reporting agencies. Keep in mind, though, rights are worthless if you as a consumer don’t know about them and thus, don’t use them.
Provided below are links to FCRA and FACTA. There is no better weapon than information and knowledge. If you have credit problems, take the time to access these two important Acts and become familiar with them. They’re not entertaining, but for any credit-troubled consumer, they’re very worthwhile. The Acts will show you that you are not without power to dispute inaccurate negative items in your credit report. With knowledge of the Acts in hand, you can take on the bureaucracies of the credit reporting agencies on your own to repair your credit. Or, if you prefer, you can contact a reputable credit repair organization such as New Horizon Credit Solutions, LLC, to repair your credit and start you to a new horizon in your financial life.
An example why you the credit consumer must know about the rights you have under FCRA and FACTA if you are to benefit from the rights, has to do with credit repair and the disputing of inaccurate or incomplete information in your credit report. The FCRA holds that the credit reporting agency and the information provider have responsibilities for correcting inaccurate or incomplete information in your credit report. That’s good. Unfortunately, it’s not up to them to find the inaccuracies, it’s up to you to discover the inaccuracies on your own and then, it’s up to you to contact the credit reporting agency and/or the information provider to dispute the inaccuracy and try to get it removed from your credit report.
If you don’t know about your rights to review your credit record, check for inaccuracies and then dispute those inaccuracies, your credit record will continue with its inaccuracies and low credit score, and your credit troubles will continue on and on.
A final word about your rights in the credit repair aspect of credit consumerism. The FCRA sets forth the process: Tell the credit bureau in writing what information you believe to be inaccurate. The credit bureau must reinvestigate the items in question, usually within 30 days, unless they consider your dispute frivolous. Did you get that? Unless they consider your dispute frivolous. How convenient for the credit bureaus. All they need do is take the position that your dispute is frivolous, or put up some other stall tactic to frustrate you, the consumer, in hopes you’ll give up and leave your credit record stand with its inaccuracies as you continue to pay higher interest rates and fees which may be resulting from those inaccuracies.
Some people with credit troubles have the ability, the interest, the time and the persistence, to read laws like the FCRA and FACTA to learn their rights and then, to read and interpret their credit reports and scores, write dispute letters, read and analyze the return documents from the credit bureaus and thereafter, to write other letters perhaps more than once or twice to get the desired results from the credit bureaus. If you’re one of those people, we wish you the very best.
On the other hand, some people either don’t have the time or don’t feel comfortable in undertaking their own credit repair and would rather put the matter in the hands of a credit repair professional. If you’re one of these people, we invite you to contact New Horizon Credit Solutions, LLC for that new horizon you’re wanting in your life.
Either get to know your rights as a credit consumer,
Or get to know us, New Horizon Credit Solutions, LLC
Because we know your rights, you don’t have to! |
