§1681s–2 Responsibilities of Furnishers of Information to Consumer Reporting Agencies

Summary

Stop giving wrong credit information. If a company sends information about you to a credit reporting agency, it must not give information it knows or has good reason to think is wrong. If you tell that company, at the address it set up for notices, that a specific item is wrong and it really is wrong, the company must stop sending that wrong item. “Reasonable cause to believe” means the company has specific facts, not just the consumer’s claims, that make the information doubtful. A consumer can ask a lender to remove a default on a private education loan if the lender offers a loan rehabilitation plan, the plan requires a set of consecutive on-time payments, and the consumer completes it. A bank supervised by a federal agency must get written approval of the rehab terms and the agency must give feedback within 120 days. A loan can be rehabilitated this way only once per loan. For help given because of COVID-19 (called an “accommodation” — for example, deferring, reducing, or modifying payments — during the “covered period” that starts January 31, 2020 and ends either 120 days after March 27, 2020 or 120 days after the national emergency ends), the furnisher must report the account as current if the consumer makes the required payments or is not required to pay. If the account was delinquent before the accommodation, the furnisher should keep that delinquent status while the accommodation is in effect, unless the consumer brings the account current, in which case the furnisher must report it as current. These rules do not apply to accounts that have been charged off. Companies that regularly give consumer data must correct incomplete or wrong information and must tell credit agencies if an item is disputed by the consumer. If a consumer closes an account, the furnisher must report that voluntary closure in its regular reporting. If a delinquent account is sent to collection, charged off, or treated similarly, the furnisher must tell the agency the month and year when the delinquency began within 90 days. Furnishers must have procedures to handle identity-theft reports and must not send blocked identity-theft information to credit agencies unless they learn it is correct. Banks that report negative information (late payments, defaults, insolvency) must give the customer a clear written notice either before or within 30 days after reporting; a short model notice (no more than 30 words) may be used. Consumers can also send a dispute directly to the furnisher at the address the furnisher provides. That dispute must say exactly what is wrong, explain why, and include any proof the furnisher requires. The furnisher must investigate, review what the consumer gives, finish within the same time the law gives credit bureaus to investigate, tell the consumer the result, and fix any confirmed errors with all credit agencies it used. Furnishers can ignore frivolous or repeated disputes but must tell the consumer within 5 business days why and what more is needed. Disputes prepared or submitted by credit repair companies are excluded from the direct-dispute rules. Medical providers who report consumer medical bills must identify themselves as medical information furnishers. The Consumer Financial Protection Bureau must make guidelines and rules to help furnishers keep their information accurate and to require them to have reasonable policies and procedures to implement those guidelines. Finally, many enforcement and private lawsuit rules for these duties are handled by the government agencies named in the law rather than by private lawsuits.