Denied Credit

This term means that a financial institution, bank, lender or other party with the ability to do so has decline to enter into a credit agreement with a consumer.

The consumer, due to regulations put in place through Fair Credit Reporting Act, does have recourse in such a situation. When a consumer is denied credit, according to the Equal Credit Opportunity Act, the creditor must provide specific written information detailing the reasons that the request for credit was denied, as well as the contact information for the credit reporting agency that provided the information used in making the decision. The consumer should then contact the credit reporting agency to request information relating to the credit report.

If this is done within 60 days of the denial, the information is provided free of charge. In addition, there are a variety of services that are easily accessed via the Internet that provide free credit reports. If there are errors in the report that result in a credit dispute, the consumer must contact the credit reporting agency in writing and provide supporting documentation of his or her claim of error. The credit reporting agency is required by law to investigate the complaint, usually within 30 days of receiving the letter and associated documentation.