Legal vs. Factual Credit Report Disputes: What You Need to Know

Your credit report is crucial to your financial well-being. The consequences of credit reporting errors can be devastating, from securing housing and employment to qualifying for a car loan or mortgage. A lower credit score can raise interest rates, limit job opportunities, or even lead to loan denials.

Fortunately, the Fair Credit Reporting Act (FCRA) offers protection, giving consumers the right to dispute false information and hold credit reporting agencies accountable. But not all errors are treated equally under the law. A long-standing gray area in credit reporting has been the difference between factual inaccuracies and legal disputes. However, recent legal developments could change things.

Consumers should know the difference between factual and legal errors on their credit report and how they may impact their rights if they notice misleading or inaccurate information.

Factual vs. Legal Disputes in Credit Reporting

For years, credit bureaus have argued that the FCRA only requires them to address factual errors, not legal disagreements. However, a recent decision by the Fourth Circuit Court of Appeals is reshaping that narrative, expanding consumers’ rights and imposing new obligations on credit reporting agencies.

What Is a Factual Credit Reporting Dispute?

A factual dispute involves an objective mistake. These are things that are verifiably wrong, and the kinds of errors most people think of when they notice a problem on their credit report.

• Loans are listed as unpaid when it was paid off months ago
• Accounts that belong to someone else with a similar name
• Duplicate entries for a single debt
• Balances that have been misreported or miscalculated

These issues are clearly within the scope of the FCRA. If you send a written dispute to the credit bureau, they are legally required to conduct a reasonable investigation, typically within 30 days. You may have a valid legal claim if they fail to correct the error.

What Is a Legal Credit Report Dispute?

Legal disputes, on the other hand, are more nuanced. These involve situations where the facts may be accurate, but their legal meaning or consequence is questioned. Examples include:

• Debts beyond the statute of limitations
• Lease fees or penalties that may not be legally enforceable
• Debts discharged in bankruptcy are still being reported as due
• Debts incurred under fraudulent or coercive conditions (such as in a domestic violence situation)

Credit reporting agencies have historically claimed that resolving legal disputes falls outside their duties under the FCRA. In other words, if there’s a question about how the law should apply to your debt, they’ve argued it’s not their job to figure that out.

Until recently, many courts agreed.

Why This Matters for Ohio Consumers

If you’ve been reported for a debt that you don’t legally owe, such as one that was discharged, expired, retaliatory, or otherwise invalid, you may now have a stronger legal footing to challenge it.

At Luftman, Heck & Associates, we’ve seen how credit reporting errors can wreck people’s lives. We’ve also seen how difficult it can be to resolve issues when credit bureaus claim it’s “not their responsibility.”

But the law is evolving, and courts are beginning to recognize that consumers shouldn’t be stuck in limbo when legal inaccuracies do real harm. The Fourth Circuit’s decision sets an important precedent that could influence how other courts, including Ohio,  approach FCRA claims moving forward.

LHA Ohio Debt Handles All Types of Credit Report Disputes

At Luftman, Heck & Associates, we’re committed to protecting Ohio consumers from the consequences of unfair, inaccurate, and unlawful credit reporting. Whether you’re dealing with a clear-cut factual error or a more complex legal issue, we’re ready to help.

Our credit error dispute lawyers will:

• Review your credit reports and identify potential violations
• Help you dispute errors with the credit bureaus and furnishers
• Investigate whether your situation involves a legal mischaracterization
• File FCRA lawsuits when necessary to protect your rights and secure damages

When you work with us, you’re not just getting a legal team—you’re gaining a trusted advocate who knows how to navigate the complexities of credit reporting law.

Don’t Let a Credit Error Derail Your Life—Call an Ohio Debt Relief Lawyer

If your credit report contains a debt you don’t legally owe, or if you’ve been harmed by false, misleading, or retaliatory information, it’s time to take action. Let us help you set the record straight.

Contact LHA for your 100% free FCRA consultation. We’ll evaluate your case, explain your rights under the FCRA, and help you confidently move forward.