Educational Resources: Safe Credit
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When you are turned down for a loan
If you apply for a loan and are turned down, the lender must notify you, in writing,
within 30 days of the completed application. This notification is required by ECOA.
The notice will contain:
- The name and address of the creditor
- The name and address of the federal agency you can write to if you feel you have
been discriminated against, and
- Either a statement of specific reasons for denial or a notice that you may request
the specific reasons for your denial.
If you are denied credit because of information in your credit report, the lender
is required to notify you. This notification is required by the Fair Credit Reporting
Act or FCRA. The notice is usually combined with your denial notice. The FCRA notice
should contain:
- The name, address and telephone number of the consumer reporting agency that provided
the report to the lender.
- a statement that the consumer reporting agency did not make the decision to deny
your application.
- A notice of your right to obtain a free copy of your credit report within 60 days
of receiving the notice.
- A notice of your right to dispute the information in your credit report.
(The
To Your Credit
course covers credit reports and how to correct inaccurate information) What action
can you take if you feel you have been denied a loan based on a prohibited basis?
- Complain to the creditor in writing and keep a copy. The lender may find an error
and reverse the decision.
- Report possible violations to the appropriate government agency. The agency's name
and address will be listed on your denial notice.
There are also laws that protect your rights
after you get a loan.