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What Damages Can You Recover in an FCRA Lawsuit?
Cultivating a strong credit score can take years. But when it’s damaged because a credit bureau includes false or outdated information and refuses to fix it, the consequences can feel overwhelming and unfair.
Loan applications may be denied, job offers might fall through, and you may even be charged more for insurance or turned away from housing options or financing for which you should be eligible. Fortunately, the law gives consumers the right to accurate credit reporting and the legal tools to fight back when those rights are violated.
So, suppose your dispute was ignored or unresolved. In that case, you may be entitled to recover certain damages through an FCRA lawsuit, and a knowledgeable Ohio credit reporting attorney can guide you through this process, helping you pursue compensation and hold credit agencies accountable.
FCRA Lawsuits for Credit Report Errors
The Fair Credit Reporting Act (FCRA), passed in 1970, protects consumers from inaccurate, misleading, or outdated credit reporting. It ensures that credit reports used by lenders, landlords, employers, and insurers are fair and accurate. The FCRA applies to:
- Credit reporting agencies (Equifax, TransUnion, Experian)
- Furnishers of information (banks, lenders, collection agencies)
- Entities that use credit reports (employers, landlords, insurance companies)
The FCRA gives consumers the right to dispute errors and requires credit bureaus to investigate and correct any inaccurate or unverifiable information. You can take legal action if they fail to meet their obligations or willfully ignore your dispute.
What Does an FCRA Violation Look Like?
Violations of the FCRA occur when credit reporting agencies or furnishers fail to follow the law in how they gather, verify, or handle your credit information. Common violations include:
- Reporting incorrect personal details, such as the wrong Social Security number or address, can lead to a mixed credit file.
- Including outdated negative accounts that should have been removed after the reporting period had expired (typically seven years).
- Listing duplicate accounts makes your debt appear higher than it really is.
- Reporting incorrect account statuses, such as marking a paid account as delinquent.
- Failing to remove accounts that don’t belong to you often due to clerical errors or identity theft.
- Reinserting previously corrected errors without proper notice or justification.
If you file a dispute and the bureau fails to reasonably investigate, continues reporting incorrect information, or allows the same errors to reappear, it may be considered a violation of your FCRA rights.
The Penalties for FCRA Violations
Depending on whether the violation was negligent or willful, the penalties for violating the FCRA can include monetary damages, legal fees, and, in extreme cases, punitive damages.
Compensation You Can Recover for FCRA Violations
When a credit bureau or furnisher of information fails to correct an error or violates your rights under the FCRA, you may be entitled to several forms of compensation:
FCRA Actual Damages
These damages cover the real-world harm you’ve suffered. There is no cap on how much you can recover if you can prove the damages. Examples include:
- Denied mortgage or loan applications
- Higher interest rates due to a damaged credit score
- Lost job opportunities because of failed background checks
- Emotional distress caused by prolonged financial hardship
Actual damages are the most common form of compensation in FCRA lawsuits and often comprise the core of your legal claim.
FCRA Statutory Damages
If you can show that the credit bureau or data furnisher willfully violated the FCRA, you may be eligible for statutory damages. These don’t require proof of specific losses and range from $100 to $1,000 per violation. This type of damage is significant if you’ve experienced recurring issues or systemic failures.
Punitive FCRA Damages
Punitive damages may be awarded in cases of willful misconduct beyond negligence, where the credit bureau acted recklessly or disregarded your rights. These damages are designed to punish bad behavior and discourage repeat violations.
While not available in every case, punitive damages can significantly increase your total compensation if the violation was particularly egregious.
Attorneys’ Fees & Legal Costs
The FCRA allows consumers to recover their legal expenses from the defendant if their case is successful. This ensures that people harmed by inaccurate credit reporting can pursue justice without being limited by financial constraints.
In many cases, FCRA attorneys handle claims on a contingency basis, meaning you don’t pay anything unless you win or reach a settlement.
How to File an FCRA Lawsuit & Recover Damages
If you’ve discovered errors on your credit report and want to take legal action, here are the steps to follow:
- Dispute the Error: You must submit a dispute to the credit reporting agency before filing a lawsuit. Include clear explanations and supporting documentation.
- Wait for the Investigation: The agency has 30 days to investigate and respond. If they fail to correct the error—or the issue resurfaces—you may be eligible to sue.
- Gather Documentation: Save copies of your credit reports, dispute letters, denial notices, and any communication with the agency or creditor. These documents help prove your claim.
- Contact an FCRA Attorney: An experienced consumer law attorney can assess your case, file the lawsuit, and guide you through negotiations or trial.
Many FCRA claims are settled out of court, but legal pressure is often the only way to ensure that the agencies take your complaint seriously. An Ohio FCRA lawyer can help you know when to dispute credit report errors and decide when to sue.
FAQs About FCRA Violations & Lawsuits
Should I dispute a credit error before filing a lawsuit?
Yes. You must give the credit bureau a chance to fix the error. If they fail to respond appropriately or continue reporting inaccurate information, you can sue under the FCRA.
How long do I have to file an FCRA lawsuit?
The FCRA statute of limitations gives you two years from when you discovered the violation or five years from the date the violation occurred, whichever is earlier.
Can I sue the credit bureau and the company that reported the error?
If both the credit bureau and the furnisher (like a lender or collection agency) violated the FCRA, they can be named in the same lawsuit for errors on your credit report.
Do I need to show financial harm to win?
Not always. If the violation was willful, you may still be entitled to statutory damages even if you didn’t suffer direct financial losses.
What if the same error keeps coming back after being fixed?
This could indicate systemic issues. Repeated reinsertion of an error after it’s been corrected is grounds for legal action and may strengthen your claim for punitive damages.
Don’t Face an FCRA Violation Alone. Call LHA Now
Credit scores are essential to getting financing, no matter what stage you’re at in life. When a credit bureau isn’t cooperating or erroneously reporting your score, you need to act. Luftman, Heck & Associates is ready to help repair the damage someone else’s mistake has caused.
Contact LHA for a free consultation to discuss your credit report issues and explore what options are available to you.