Lawmakers in Washington, DC are considering several credit-related consumer protections as outlined in the Fair and Accurate Credit Transactions Act of 2003 (HR 2622). If approved, consumers could benefit from the biggest changes to the rules of consumer credit in recent decades. One of the most important changes would be entitled to a free annual copy of your credit report, upon request, of the three major credit reporting agencies: Equifax, Experian and TransUnion. At present only six U.S. states offer their residents of this form of consumer protection. Federal law requires that a consumer may obtain a free copy of your credit report only if they have been denied a loan or credit based on the information contained in your credit reports.
Other highlights of the Fair and Accurate Credit Transaction Act of 2003 include: Special Notices when excessive investigations (credit checks of potential lenders and creditors) are reducing their credit score significantly, the notice to creditors when sending derogatory account information to any credit reporting agencies national block negative credit information caused by an identity thief appears again on credit reports, creditors mandate to establish guidelines to prevent the issuance of credit are supposed to be fraudulent, the disclosure of credit scores used in connection with loan application decision and an explanation of the key factors that were used to determine the level, require disclosure of the name, address and telephone number of businesses that supply information to credit bureaus. At first glance, this bill seems to provide credit protection for consumers valuable. However, there are others who feel good about this legislation is not doing enough or even reduce the rights of consumers. The proposed federal law would override tougher laws that already exist in some states and has consumer advocates concerned. For a detailed analysis of HR 2622 by leading consumer advocates, visit legislators and consumer groups agree that changes must be made to better protect consumers and their credit rights. Whether or not the Fair and Accurate Credit Transaction Act can address these issues remains to be seen.