Landlords and Other Information Providers Responsibility To Credit Reporting Agencies
The Fair Credit Reporting Act (FCRA) is designed to protect the privacy
of credit report information and to guarantee that information supplied by consumer
reporting agencies (CRAs) is as accurate as possible. If you provide information
to a CRA, such as a credit bureau, be aware that amendments to the law spell out
new legal obligations. These amendments were effective
September 30, 1997
Does the FCRA Affect Me?
If you report information about consumers to a CRA, you are considered
a "furnisher" of information under the FCRA. CRAs include many types of
databases -- credit bureaus, tenant screening companies, check verification services,
and medical information services -- that collect information to help businesses
evaluate consumers. If you provide information to a CRA regularly, the FCRA requires
that the CRA send you a notice of your responsibilities.
What Are My Responsibilities?
The responsibilities of information providers are found in Section
623 of the FCRA, 15 U.S.C. §1681s-2, and are explained here. Items 2 and apply only
to furnishers who provide information to CRAs "regularly and in the ordinary
course of their business." All information providers must comply with the other
1. General Prohibition on Reporting
Inaccurate Information - Section 623(a)(1)(A) and Section 623(a)(1)(C).
You may not furnish information that you know -- or consciously avoid
knowing -- is inaccurate. If you "clearly and conspicuously" provide consumers
with an address for dispute notices, you are exempt from this obligation but subject
to the duties discussed in Item 3.
What does "clear and conspicuous" mean? Reasonably easy
to read and understand. For example, a notice buried in a mailing is not clear or
2. Correcting and Updating Information
-- Section 623(a)(2).
If you discover you've supplied one or more CRAs with incomplete or
inaccurate information, you must correct it, resubmit to each CRA, and report only
the correct information in the future.
3. Responsibilities After Notice of
a Consumer Dispute from a Consumer--Sections 623(a)(1)(B) and 623(a)(3). If a consumer
writes to the address you specify for disputes to challenge the accuracy of any
information you furnished, and if the information is, in fact, inaccurate, you must
report only the correct information to CRAs in the future. If you are a regular
furnisher, you also will have to satisfy the duties in Item 2. Once a consumer has
given notice that he or she disputes information, you may not give that information
to any CRA without also telling the CRA that the information is in dispute.
4. Responsibilities After Receiving
Notice from a Consumer Reporting Agency -- Section 623(b).
If a CRA notifies you that a consumer disputes information you
* You must investigate the dispute
and review all relevant information provided by the CRA about the dispute.
* You must report your findings to
* If your investigation shows the
information to be incomplete or inaccurate, you must provide corrected information
to all national CRAs that received the information.
* You should complete these steps
within the time period that the FCRA sets out for the CRA to resolve the dispute
-- normally 30 days after receipt of a dispute notice from the consumer. If the
consumer provides additional relevant information during the 30-day period, the
CRA has 15 days more. The CRA must give you all relevant information that it gets
within five business days of receipt, and must promptly give you additional relevant
information provided from the consumer. If you do not investigate and respond within
the specified time periods, the CRA must delete the disputed information from its
5. Reporting Voluntary Account Closings
-- Section 623(a)(4).
You must notify CRAs when consumers voluntarily close credit accounts.
This is important because some information users may interpret a closed account
as an indicator of bad credit unless it is clearly disclosed that the consumer --
not the creditor -- closed the account.
6. Reporting Delinquencies -- Section
If you report information about a delinquent account that's placed
for collection, charged to profit or loss, or subject to any similar action, you
must, within 90 days after you report the information, notify the CRA of the month
and the year of the commencement of the delinquency that immediately preceded your
action. This will ensure that CRAs use the correct date when computing how long
derogatory information can be kept in a consumer's file.
How do you report accounts that you have charged off or placed
for collection? For example:
* A consumer becomes delinquent on
March 15, 1998
. The creditor places the account for collection on
October 1, 1998
. In this case, the delinquency began on March 15,1998. The date that the creditor
places the account for collection has no significance for calculating how long the
account can stay on the consumer's credit report. In this case, the date that must
be reported to CRAs within 90 days after you first report the collection action
is "March 1998."
* A consumer falls behind on monthly
payments in January 1998, brings the account current in June 1998, pays on time
and in full every month through October 1998, and thereafter makes no payments.
The creditor charges off the account in December 1999.
In this case, the most recent delinquency began when the consumer
failed to make the payment due in November 1998. The earlier delinquency is irrelevant.
The creditor must report the November 1998 date within 90 days of reporting the
charge-off. For example, if the creditor charges off the account in December 1999,
and reports this charge-off on
, the creditor must provide the month and year of the delinquency (i.e., "November
1998") within 90 days of
December 31, 1999
* A consumer's account becomes delinquent
December 15, 1997
. The account is first placed for collection on
April 1, 1998
. Collection is not successful. The merchant places the account with a second collection
June 1, 2003
The date of the delinquency for reporting purposes is "December
1997." Repeatedly placing an account for collection does not change the date
that the delinquency began.
* A consumer's credit account becomes
April 15, 1998
The consumer makes partial payments for the next five months but never
brings the account current. The merchant places the account for collection in May
of 1999. Since the account was never brought current during the period that partial
payments were made, the delinquency that immediately preceded the collection commenced
in April 1998 when the consumer first became delinquent.
For More Information
You can file a complaint with the FTC by contacting the
by phone: 202-FTC-HELP (382-4357); TDD: 202-326-2502; by mail:
Consumer Response Center
, Federal Trade Commission,
Pennsylvania Ave, NW, Washington,
; or through the Internet, using the online complaint form. Although the Commission
cannot resolve individual problems for consumers, it can act against a company if
it sees a pattern of possible law violations.
The FTC publishes free brochures on many consumer issues. For a complete
list of publications, write for Best Sellers,Consumer Response Center,
Federal Trade Commission,
600 Pennsylvania Ave, NW, Washington, D.C. 20580
; or call (202) FTC-HELP (382-4357), TDD (202) 326-2502.