Consumer Rights and Credit Reporting

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Questions and Answers

What is the maximum frequency at which a consumer can request a free credit report from each of the three major credit reporting agencies?

Only once in a lifetime
Once every 6 months
Once every 2 years
Once every 12 months (correct)

What is the time frame within which a CRA must investigate and verify a dispute?

60-90 days
45-60 days
15-30 days
30-45 days (correct)

What is the consequence of a CRA not complying with the FCRA?

The consumer's credit report is frozen
The CRA must pay a fine
The CRA's registration is revoked
The consumer can sue the CRA (correct)

Who must provide accurate and complete information to CRAs?

Data furnishers (A) Signup and view all the answers

What is the purpose of a CRA's registration with the Federal Trade Commission (FTC)?

To ensure compliance with FCRA regulations (D) Signup and view all the answers

What is the consequence of a furnisher not investigating and correcting inaccurate information?

The consumer can sue the furnisher (D) Signup and view all the answers

What is the first step in the dispute resolution process?

The consumer disputes the information in writing (A) Signup and view all the answers

What is the purpose of the disclosures that CRAs must provide to consumers?

To inform consumers of the nature and scope of the report (C) Signup and view all the answers

What is the responsibility of CRAs in maintaining the accuracy of information?

To ensure maximum possible accuracy (B) Signup and view all the answers

What is the outcome of a successful dispute resolution process?

The CRA corrects or removes the inaccurate information (B) Signup and view all the answers

What is the primary focus of the Fair Credit Reporting Act (FCRA)?

Providing a framework for consumer protection in the credit system (D) Signup and view all the answers

What is the main goal of the Credit advocacy Certification Program?

To equip professionals with knowledge, skills, and ethics for effective credit advocacy (C) Signup and view all the answers

Which legislation ensures that all consumers have fair access to credit opportunities?

Equal Credit Opportunity Act (ECOA) (B) Signup and view all the answers

What is the significance of understanding consumer rights under key legislations?

To empower consumers to navigate the credit system with confidence (B) Signup and view all the answers

What is the next step in the Credit advocacy Certification Program after Module 1?

Deep dive into credit health and reports (A) Signup and view all the answers

What is the outcome of building a strong foundation in understanding the credit system?

Building healthier financial futures (B) Signup and view all the answers

What is the primary concern of the Fair Debt Collection Practices Act (FDCPA)?

Protecting consumers from abusive debt collection practices (C) Signup and view all the answers

What is the significance of the Credit Repair Organizations Act (CROA) in the credit advocacy industry?

Mandating credit advocacy organizations to operate under transparent and fair practices (A) Signup and view all the answers

What is the importance of understanding the credit system in the Credit advocacy Certification Program?

To lay the groundwork for understanding more complex aspects of credit advocacy (B) Signup and view all the answers

What is the ultimate goal of the credit advocacy industry?

Advocating for fairness, transparency, and respect within the credit advocacy industry (D) Signup and view all the answers

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Study Notes

Consumer Rights

Right to Access: Consumers have the right to request a free credit report from each of the three major credit reporting agencies (CRAs) once every 12 months.
Right to Dispute: Consumers have the right to dispute inaccurate or incomplete information on their credit report.
Right to Receive Disclosures: Consumers have the right to receive disclosures from CRAs, including the nature and scope of the report, and the right to dispute information.
Right to Sue: Consumers have the right to sue CRAs and furnishers for violations of the FCRA.

Dispute Resolution

Dispute Process: Consumers must dispute inaccurate information in writing to the CRA.
CRA Investigation: The CRA must investigate and verify the dispute within 30-45 days.
Resolution: The CRA must correct or remove the inaccurate information, and notify the consumer of the results.
Furnisher Investigation: The furnisher of the information must also investigate and correct any inaccuracies.

Compliance Regulations

FCRA Requirements: CRAs and furnishers must comply with the FCRA, including maintaining reasonable procedures to ensure the maximum possible accuracy of information.
Data Furnisher Requirements: Data furnishers must provide accurate and complete information to CRAs, and must investigate and correct any inaccuracies.
CRA Registration: CRAs must register with the Federal Trade Commission (FTC) and comply with FCRA regulations.
Furnisher Liability: Data furnishers can be held liable for violating the FCRA.

Credit Reporting Agencies

Major CRAs: The three major CRAs are Equifax, Experian, and TransUnion.
CRA Responsibilities: CRAs are responsible for collecting, maintaining, and reporting consumer credit information.
CRA Obligations: CRAs must follow FCRA regulations, including providing consumer disclosures and investigating disputes.
CRA Limits: CRAs are limited in the types of information they can collect and report, and must ensure the accuracy and completeness of the information.

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