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Fair Credit Reporting Act

Fair Credit Reporting Act

The Fair Credit Reporting Act (FCRA) requires credit reporting agencies to provide accurate information to lenders. The FCRA also creates legal rights for consumers whose information is being investigated and misrepresented by credit reporting agencies such as TransUnion, Experian, and Equifax.

Credit report agencies make money off of lenders who are requesting credit reports to justify loans and interest rates. Credit report agencies are not government funded. Credit reports are often required for loans on larger purchases such as cars and homes mortgages. Credit reporting agencies over report negative credit information to lenders, such as missed payments and debts. Lenders make more money off of people who are deemed a higher credit risk because they can enforce higher interest rates. Therefore, a lender will keep returning to a credit reporting agency who can help provide information that can support higher interest rates.

Consumer Rights Protected by the Fair Credit Reporting Act (FCRA)

A consumer has the right to have an accurate credit report distributed to lenders. A consumer also has the right to challenge credit report agencies who are providing false or inaccurate information. A lender must provide a consumer with the name of the credit reporting agency who allegedly provided inaccurate information on a credit report if requested.

The FCRA also made it illegal for credit reporting agencies to provide subjective information on a credit report such as religion, race, how long you have been committed to your job and details about other people you may live with.

How Can a Consumer Challenge a Credit Reporting Agency Under the FCRA?

A consumer must send a written letter to the credit report agency detailing the inaccurate information provided on the credit report. It is important for the consumer to provide as much documentation as possible to support why the information is inaccurate. Depending on the inaccurate information bank statements, records, and receipts of purchases are good examples of documents to provide.

A credit reporting agency who receives a letter must re investigate in the information being provided on the consumers credit report. Then must reply to the consumer detailing if the information was corrected or not. If a credit reporting agency refuses to fix inaccurate information, the consumer should then seek out a consumer lawyer to help sue the company.

What Type of FCRA Damages Can a Consumer Sue For?

  • Actual damages are real losses for the consumer. Regarding the FCRA, a consumer might experience financial loss due to inaccurate information being provided on a credit report. A consumer who receives a higher interest rate on a loan or mortgage can experience economic loss and possibly debt.
  • Statutory damages are when the credit reporting agency is providing inaccurate information, but the consumer has not financially been affected yet. The inaccurate information could be preventing the consumer from even acquiring a loan.
  • Punitive damages are deliberate wrongdoings by a credit reporting agency. An example of a wrongdoing would be a credit report agency refusing to read a letter from a consumer or refusing to re investigate the information being provided on a credit report. Punitive damages are rare in cases regarding the FCRA.

A credit reporting agency will also be responsible for paying lawyer fees if the consumer wins the case.

Why May There Be Inaccurate Information on a Credit Report?

Mistaken identity is an issue the credit reporting agencies battle. These mistakes are often due to a merged file. Consumers with common last names and the same first names can be confused. False addresses can appear on credit reports from someone with the same name living at a different address. Seniors and Juniors can be commonly confused especially if they live at the same address to.

There are many complaints about credit report agencies. The Federal Trade Commission (FTC) does not have resources and funding to check all the information the credit report agencies are providing to lenders.

How Can a Consumer Check Their Credit Report?

Consumers are able to access their credit report annually from TransUnion, Experian, and Equifax. Most negative information is only listed on a credit report for seven years. Bankruptcy is usually listed for ten years. Also consumers have to give permission to lenders to look at their credit report.

You can find more information about the Fair Credit Reporting Act (FCRA) by reading 23 Legal Defenses to Foreclosure: How to Beat the Bank by Troy Doucet. If in Ohio, call Doucet & Associates Co., L.P.A. at (614) 944-5219 for a consultation.

 

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Remembering 9/11

Remembering 9/11

On Sunday, people in the United States of America will gather to reflect on a tragic time in our nation’s history. Honoring the innocent lives that were taken that day and remembering those who emerged to serve and offer assistance when our nation was experiencing tragedy represents the best of our country.  Recollecting the facts of that day in 2001 is important for our nation to recall a time of standing together for all that were directly and indirectly affected.

The terrorism by an Islamic extremist group brought upon our country that day involved four plane crashes. Two hijacked planes were flown into the Twin Towers of the World Trade Center in New York City. A third plane struck the Pentagon at the U.S. military headquarters in Arlington, Virginia. And the fourth crashed down in a field in Shanksville, Pennsylvania. Including heroic police officers, firefighters and civilians, over 3,000 lives were loss that day in tragic destruction.

In replace of the World Trade Center towers that were traumatically destroyed now stands the One World Trade Center. This building is also commonly referred to as the Freedom Tower and is now the tallest skyscraper in the Western Hemisphere standing at a 1,776 feet. The height is iconic and meant to resemble the year the Declaration of Independence was enacted. In May 2013, a spire was also positioned on the top of the building to ensure it was the tallest building with the highest point making the height at the tip an estimated 1,792 feet. September 11 is also now legally designated as Patriot Day.

There are many national events happening on Sunday in recognition of this devastating occurrence.  The most common that often take place country wide include the moments of silence.

  • 8:46 am The first plane crashed into the North Tower at the World Trade Center.
  • 9:03 am The second plane crashed into the South Tower at the World Trade Center.
  • 9:37 am The third plane crashed into the Pentagon in close proximity to Washington D.C.
  • 10:03 am The fourth plane crashed in Pennsylvania after passengers on board take control from hijackers after learning of the other attacks.
  • 10:28 am The North Tower collapses and rescue effort begins.

 

Locally in Columbus, Ohio there are also many events taking place to help honor and remember everyone impacted. Some of the events included but are not limited to are:

There is the Memorial Stair Climb taking place at the Chase Tower in downtown Columbus.

The Heroes Run on September 10 at Alum Creek Park North.

A Memorial Flag Display at the Ohio Statehouse.

The Ruc. Run. Remember. race in Groveport, Ohio.

There are many more local events happening all around Columbus, Ohio. We welcome you to leave information about an event in the comments to inform and bring awareness of how our country is coming together. Doucet & Associates also would like to acknowledge our heartfelt condolences to everyone affected.

 

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Right of Rescission

Right of Rescission

A borrower facing foreclosure has a number of defenses to losing his or her home.  One such defense is the right of rescission.  One can think of rescission as the ending of a contract or agreement.  Under the Truth in Lending Act (“TILA”), 15 U.S.C. § 1635, a borrower has the right of rescission as to certain transactions including mortgage refinancing, a home equity line of credit, a home improvement plan, or any other non-purchase credit transaction secured by the borrower’s principal dwelling .  However, TILA’s right of rescission does not apply to the purchase of a home.

TILA “requires creditors to provide borrowers with clear and accurate disclosures of terms dealing with things like finance charges, annual percentage rates of interest, and the borrower’s rights[.]”  Barrett v. JP Morgan Chase Bank, N.A., 445 F.3d 874, 877 (6th Cir. 2006).  See also 12 C.F.R. § 226.1(b) (“The purpose of this regulation is to promote the informed use of consumer credit by requiring disclosures about its terms and cost.”).

Normally, a borrower is allowed until midnight of the third business day after the consummation of the transaction or delivery of the required TILA disclosures to the borrower, whichever is later, to rescind the transaction.  But if the lender does not provide the required TILA forms and disclosures to the borrower, the borrower’s right of rescission may extend up to three years.  In other words, a borrower has an “unconditional right to rescind for three days,” after which the borrower has three years to rescind if the lender fails to satisfy TILA’s disclosure requirements.  Jesinoski v. Countrywide Home Loans, Inc., 135 S. Ct. 790, 792 (2015).

If a lender does not meet its TILA disclosure obligations and the borrower wishes to rescind the transaction within the three year time period, the borrower may do so by giving notice to the lender in accordance certain Federal Reserve Board regulations.  For a borrower, a rescission of a transaction means the borrower is refunded all payments, fees, and costs, essentially placing the borrower in a position as if the transaction never occurred.

If you feel your lender did not meet the TILA disclosure requirements, please give Doucet & Associates a call at (614) 944-5219 to discuss your legal options.

 

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How to Correct Mortgage Errors

How to Correct Mortgage Errors

For years, homeowners have complained that mortgage companies do not adequately address concerns about their loans, do not respond to requests for information, or fail to correct errors.  This has become such a problem that federal law now requires mortgage companies to formally respond to any homeowner’s written request when the request alleges the mortgage company:

Failed to accept payments or apply payments correctly;

Failed to credit payments on the receipt date;

Failed to pay escrows as agreed;

Charged unreasonable fees, or without a basis;

Failed to provide an accurate payoff quote;

Failed to timely provide transferring notices; or

Failed to provide assistance to avoid foreclosure.

Homeowners facing problems with their mortgage company have a right to demand the company research their complaint and provide a written answer within 30 days.  The company must correct any mortgage error immediately, or it must provide an explanation why it believes the account is correct.  It cannot simply mail the homeowner an accounting of the loan, and it cannot charge the homeowner to research the complaint.

Attorney Troy Doucet of the Dublin, Ohio law firm Doucet & Associates Co., L.P.A. regularly litigates mortgage cases on behalf of homeowners.  He recommends that homeowners with concerns about their mortgage send a written letter to their mortgage company that clearly identifies the concern, includes supporting documentation, and asks for a formal correction.  He cautions that the letter must be sent to the address designated to receive correspondence (not the payment address), and he recommends keeping a copy of the letter sent via certified mail.

The mortgage company must acknowledge receipt of the letter within five days, and respond to concerns within 30 days.  Failing to adequately respond to the letter can trigger damages under federal law, including attorneys’ fees.  If the letter does not produce the expected results, a knowledgeable foreclosure and consumer attorney should be able to help with the next step.  Call (614) 944-5219 to speak with one now.

 

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