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Fair and Accurate Trade Transactions Act 2003

Summary:

Legislation and credit records go side by side.  Many people have suffered in the past since their credit reports were inaccurate.  Free credit score reports today are much safer and accurate as they are regulated by the Fair and Accurate Trade Transactions Act 2003.

The new law, Fair and Accurate Trade Transactions Act 2003 require the bureaus offer customers with their free credit score reports.  Such reports are to be provided at a reasonable price.  The provider must also provide the explanation of the factors that are used to calculate such scores. Most of the lenders will charge interest rates based on individual credit score.

People who are checking their reports on regular basis must be able to spot and rectify the potential errors and make their reports correct.  It can rectify potentially costly errors and also make it difficult for the hackers or the identity thieves finding out the information. When the Californian Public Interest Research Group conducted the research they found that more than 25% of the credit reports including the related information contained errors that could seriously affect the credit scores of the client. When you try to get free credit report and the report contains serious errors, it could result in the denial of credit.  Such discrepancies could be false delinquencies or accounts that never belonged to the customer. There were another 54% of the credit reports that contains less serious errors.

Before the coming into force of the current time services, the consumers in most of the states were getting free credit reports only under certain specific circumstances.  When they were denied a loan or when they were subjected to some type of fraud, they could get Free credit report and not otherwise. Some of the lenders were however giving their clients the benefits of such reports free of cost when they used to apply for loans.  However, the coming into force of the Fair and Accurate Trade Transaction Act 2003 completely changed the scenario.  It was the first time that the people were getting free credit reports regardless of their credit histories.  Thus the clients were able to say without any fear that “my free credit reports” are in place.

Clients from various quarters considered that this was a hard-fought victory for the consumers.  Many however failed to understand that the trade off was pretty high. Some of them also considered that the sacrifices were more in comparison to the benefits derived.  The new law pre-empts states from passing any strong credit or privacy laws that would limit or prevent the financial institutions from sharing the customer information. Thus the consumers gained access at the cost of their privacy. Credit bureaus started marketing other services as the consumers started making requests for the Free Credit Score Report. The best part of it is that you can now get the free report online sitting at the cool comforts of your home online.  The only thing you require for the purpose is a computer with access to the Internet.

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