Fact Sheet: Know Your Rights With Credit

What is credit? Why is credit important?

Credit is a record of your payment history on any account where you spent money that you agreed to pay later. Negative information on your credit report can affect many parts of your life, including employment and housing.

How do you maintain or develop good credit?

Develop good habits to develop good credit. For example, make payments on time for all accounts including credit cards, but also utility bills. Keep the balance on your credit cards low, and, if possible, pay off the balance each month. Avoid opening too many accounts at once, and keep cards open for as long as possible. Avoid credit cards that come with an annual fee. Learn how to check your credit report for mistakes or negative information (see below on how to do that).

Why check your credit report?

You should check your credit report to make sure the information is accurate and complete. It is also important to periodically review your credit report to guard against identity theft.

How do you check your credit report?

There are three major credit reporting bureaus: TransUnion, Equifax, and Experian. Each consumer is entitled to a FREE report from each of these three agencies every 12 months. You can check them all at once or space them throughout the year. The reports can be accessed at www.annualcreditreport.com or by phone 1-877-322-8228. There are many websites offering free reports that may try to charge you, but annualcreditreport.com is the only website authorized to issue free annual reports.

What if information is wrong on the credit report?

If there is incorrect information on your credit report, the law allows you to write a letter to the credit reporting agency stating what information you believe is inaccurate. This letter should include your name and address, should clearly identify what information in the report you dispute, should state your factual reason for disputing, and should request that the incorrect information be removed. If you decide to send a letter to the credit reporting agency, then you should also be sure to make a copy for yourself. The credit reporting agency must investigate the item(s) you dispute, usually within 30 days, and then must forward all of the relevant data to the organization that provided the inaccurate information. The information provider must investigate, and if it finds incorrect information, must notify the reporting agencies.

What is the Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act, or FDCPA, is a federal law that defines consumers’ rights, provides rules for how debt collectors may do business, and provides consumers with a way to challenge and get proof of a debt.

When can creditors call you? What can you say?

Between 8am-9pm, creditors must disclose who they are, and cannot pretend to be from a government agency. Collectors may not contact you at work if you tell them either orally or in writing that you are not allowed to get calls there. Collectors cannot contact a third party about you for any reason other than getting your contact information; i.e., they may not tell anyone that you owe money, harass or abuse you or anyone else they contact about you, lie about the amount you owe or use deceptive methods to collect a debt from you. Also, collectors may not falsely claim to be law enforcement (or immigration) officers, claim that you’ll be arrested if you don’t pay your debt, threaten to seize, garnish, attach, or sell your property or your wages (unless they are permitted by law to do it and intend to do so), or give false credit information about you to anyone, including a credit reporting company.

What if I get court paperwork?

DON’T IGNORE IT! Failure to appear leads to a default judgment which will increase the amount you may owe due to fines, penalties, legal fees, and interest. Go to court! You can speak with an attorney at Tzedek DC or elsewhere on your own, can look for ways to challenge the lawsuit, can ask to waive fines/penalties/interest, or ask for a payment plan.

What is Tzedek DC and how can you contact us?

Tzedek DC (“Tzedek” is a word from the Book of Deuteronomy meaning justice) is a nonprofit public interest center headquartered at the UDC David A. Clarke School of Law. Our mission is to safeguard the rights of low and moderate income D.C. residents facing debt-related problems including lawsuits brought by debt collectors. We offer free legal services to eligible clients in debt-related matters. Contact Tzedek DC via our website at https://www.tzedekdc.org/legal-services-contact-us/ or call us at 202.274.7386 if you are experiencing threats from creditors, are being sued for a debt in DC or have found issues with your credit report, as we may be able to help. We also offer walk-in hours on a first come, first served basis on Wednesdays from 3:30-6:30 pm starting September 13 at our office at the UDC David A. Clarke School of Law at 4340 Connecticut Ave NW, Suite 319, Washington, D.C. 20008.