The Federal Trade Commission (FTC) has issued its proposed rule about free annual credit reports. The Fair and Accurate Credit Transactions Act (FACTA) and the Fair Credit Reporting Act (FCRA) require that nationwide consumer reporting agencies provide to consumers, upon request, a free copy of their credit reports once every 12 months.
The three major credit reporting agencies in the United States - TransUnion, Equifax and Experian, now provide a copy of a credit report to a consumer for about $9 each. Credit counseling services say that looking at only one credit report is virtually a useless endeavor, as they are not all the same. Reporting is a voluntary system, and creditors subscribe to whichever agency they choose. Many of them do not subscribe to all three. The proposal published March 16, 2004 establishes a centralized source and standardized form for credit report requests where consumers can order all three reports at one time through an Internet Web site, a toll-free telephone number or a postal address.
Once up and running, the FTC proposes a regional roll-out plan over nine months to make reports available to consumers. It would go from west to east, with the Western states becoming eligible for reports on December 1, 2004; Midwestern states on March 1, 2005; Southern states on June 1, 2005; and Eastern states on September 1, 2005. Such a plan would theoretically protect the credit reporting agencies from receiving a volume of free credit report requests beyond their capacity to process, and to permit them to meet their normal request schedule for credit purposes.
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