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The Changing Face of Credit Reporting System

By Andy Snyder
Published: Wednesday, December 16th, 2009

Credit report today does not look like what it was before. These documents concerning vast information with regards to how a customer handles his or her financial stability started 100 years ago. Trading of consumer financial information was pioneered by merchants merely associating with each other. Credit reporting did not start as a well established bureau a century ago. It was not intended to be as huge agencies as what they are right now. The twist of the story only came in with the arrival of the computer technology.

For most credit report advice it is always stressed that knowing your rights over your credit report is a top priority. This is very much possible with today’s credit reporting agencies but not with the CRAs before. Protecting the consumer’s rights over credit information about them started with the on set of Fair Credit Reporting Act (FCRA) in 1971. This act concerns itself with establishing privacy protection. Also this act was pursued to promote accuracy on the information that is written in details in credit reports.

The establishment of FCRA is actually a huge innovation to the processing of credit report especially on the part of the consumers. Credit reports before were merely used to elaborate negative information about the consumer. Moreover these pieces of paper cradle the irony of being your record without you knowing what is in it. Indeed credit reports are for CRA’s eyes only before FCRA.

Having the right to view your credit file is an advantage that wasn’t available before so as a credit report advice make sure that you grab this opportunity. As mandated by law under the Fair and Accurate Credit Transactions Act (FACTA), credit bureaus must provide a free copy of credit reports to consumer once every 12 months upon request.

Associated with credit reports are credit scores. These scores, like the most widely used Fair Isaac Corporation scores, provide summary of one’s credit worthiness. This three-digit number can be an important factor that can influence your major purchases plans. As a credit report advice one must be aware of what three-digit combination represents his or her credit credibility. If one finds it unreasonable then following specific credit report advice one must do the necessary actions to have it corrected. One must be wary because these credit scores are extracted from credit reports making them not error-free.

The accessibility of these scores was not possible until 2001. However, not like credit reports, there is no copy for credit scores given for free. To avoid credit score copies to be too expensive for consumers, the updated version of the fair Credit reporting Act (FCRA) which was signed into law by 2003 stated that credit reporting agencies must provide copies of credit scores to consumer at a fair and reasonable fee.

Efforts in polishing this changing face of credit reporting system are visible and are so far functional although errors in credit reports are still up. This is where your efforts are coming into the picture. Find time to do your part to have your records reported correctly. This wouldn’t cost you too much for by merely following credit report advice you can avoid creating errors at your own risk.

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