2022 Boise Idaho Real Estate Blog

The Laws That (eh-hem) Protect You

Main Boise Home Loans

The laws on the books today to help protect your credit report and profile are written too vaguely and unclear. There is too much gray area and room for interpretation. Short answer...they don't work to protect you.

If you have ever tried to dispute incorrect derogatory tradelines on your credit report (late payments that didn't happen, collections that aren't yours, etc.), you might be of the opinion that the laws that are on the books aren't helping you much. According to the law, you may ask for two things:

1) You may ask the collection agency or your creditor to verify the derogatory information
2) You may ask the credit bureaus to investigate the derogatory information that has been reported

The law even goes on to state that if your requests are not responded to within a certain time period, then your derogatory tradeline and/or information must be removed from your credit profile.

The laws in place to protect you are the Fair Credit Reporting Act and the Fair and Accurate Credit Transaction Act (FACTA). The FACTA was an amendment made in 2003 because Congress felt that the Fair Credit Reporting Act did not effectively address your right to have derogatory information verified. You and read and research these laws in greater detail at the website for the Federal Trade Commission.

The problem with these laws is...they just don't work all the time. I have helped many of my mortgage clients to file written disputes with the credit bureaus to remove incorrect derogatory tradeline information, and in doing so, we have provided copies of documentation to substantiate the claim. When our dispute is unsuccessful, the credit bureaus always say the same thing: "Experian/Equifax/Transunion has verified that this information is correct."

?!?!?! How does this happen? Mainly because of a lack of regulation. You can write all the laws you want, but if no one is actively and consistently enforcing them, then there is no teeth to the law.

The credit bureaus are very powerful. They maintain a very high paid presence of lobbyists to keep the system the way it is. To help change the system you must do two things:

1) Vote in every election
2) Write and call your elected officials and share with them why the system does not work and changes that are needed

Our elected Congressmen and Congresswomen are the only ones who have the power to start changing the system. Until more oversight and enforcement of the laws happens, consumers will be left frustrated and fighting a losing battle while trying to repair their credit reports.

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My next BLOG entry will be talking about some of the "bad credit repair advice" that has been given.

Posted by Eric Leigh at 1/30/2009 12:03:00 PM

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