Are you ready to master the Fair Credit Reporting Act? Our interactive FCRA Exam Quiz is designed to challenge and boost your compliance confidence. With realistic FCRA practice questions covering consumer reports, adverse action notices, dispute resolution and best practices - and a focused FCRA compliance quiz format - you'll quickly discover how well you grasp crucial policies. Perfect for credit professionals, paralegals, and newcomers to credit law, this comprehensive Fair Credit Reporting Act test highlights areas to improve and preps you for real-world scenarios. Looking to expand your toolkit? Tackle a credit report quiz or explore our credit score quiz to sharpen related skills. Take the quiz now, challenge yourself, and score high!
What does FCRA stand for?
Fair Credit Reporting Act
Fair Consumer Reporting Act
Federal Credit Reporting Agency
Financial Credit Rights Act
The Fair Credit Reporting Act is the federal law enacted in 1970 to regulate how consumer credit reporting agencies use and share consumer information. It establishes consumer rights and holds agencies accountable for accuracy and privacy. The act also requires notice to consumers in adverse action scenarios. For full text and details, see FTC FCRA.
How often is a consumer entitled to a free credit report from each nationwide consumer reporting agency?
Annually
Every six months
Every two years
Monthly
Under the Fair Credit Reporting Act, consumers are entitled to one free credit report every 12 months from each nationwide consumer reporting agency. This provision was updated by the FACT Act to make access easier. Consumers can request reports online, by phone or mail. For more information, see FTC: Free Credit Reports.
Under the FCRA, how long can most negative information remain on a consumer's credit report?
7 years
10 years
5 years
3 years
Most negative information, such as late payments or collections, can stay on a credit report for seven years under Section 605 of the FCRA. Bankruptcies can remain for up to 10 years, but other adverse items are limited to seven. This time limit helps ensure outdated information doesn’t unfairly burden consumers. Further reading at CFPB: Negative Information.
Which is NOT a permissible purpose for obtaining a consumer report under the FCRA?
Tenant screening
Employment screening
Credit extension
Marketing to consumers
The FCRA limits use of consumer reports to permissible purposes such as credit, employment, insurance underwriting, and renting homes. Marketing consumer reports for promotional purposes is not a permissible purpose under Section 604. Agencies must certify the purpose before releasing a report. See FTC FCRA Sections 604-605 for details.
How many days does a consumer reporting agency have to investigate a consumer dispute under the FCRA?
30 days
15 days
45 days
60 days
Under Section 611 of the FCRA, a consumer reporting agency must investigate a dispute within 30 days of receiving notice from the consumer. That period may be extended by 15 days if the consumer provides additional relevant information. The agency must also inform the furnisher of the dispute. See FTC: Disputing Credit Report Errors.
Which federal agency primarily enforces the FCRA today?
Consumer Financial Protection Bureau (CFPB)
Federal Trade Commission (FTC)
Federal Deposit Insurance Corporation (FDIC)
Securities and Exchange Commission (SEC)
Since 2012, the Consumer Financial Protection Bureau enforces the FCRA, although the Federal Trade Commission retains rulemaking authority for certain provisions. The CFPB handles consumer complaints and supervises larger institutions under the Act. Enforcement actions and guidance are on the CFPB’s website. Learn more at CFPB Credit Reporting.
What notice must a user of a consumer report provide if it takes an adverse action based on that report?
Notice of Adverse Action
Initial Disclosure Notice
Summary of Rights
Risk-Based Pricing Notice
When a user of a consumer report takes any adverse action (e.g., denying credit, employment), the FCRA requires an Adverse Action Notice under Section 615. This notice must include the CRA’s name, the consumer’s right to copy the report, and an explanation of rights to dispute. It ensures transparency in decision-making. See FTC: Adverse Action.
Under the FCRA, an initial fraud alert remains on a consumer's credit report for how long?
One year
Seven years
Thirty days
Five years
An initial fraud alert lasts one year under Section 605A of the FCRA. It signals to users of the report that they should take extra steps to verify identity. Consumers can renew or extend the alert under certain circumstances. More on fraud alerts is available at FTC: Fraud Alerts.
Which of these is a consumer's right under the FCRA?
To dispute inaccurate information
To require deletion of accurate information
To prevent credit reporting altogether
To receive unlimited free scores
The FCRA grants consumers the right to dispute inaccurate or incomplete information on their credit reports under Section 611. The CRA and furnisher must then investigate and correct or delete errors. Consumers cannot demand deletion of accurate data and cannot block legitimate reporting. For dispute guidance, see FTC: Dispute Errors.
Which type of credit inquiry is considered a "hard inquiry" under the FCRA?
A credit card application initiation
A pre-approved credit offer review
A routine account review by current creditor
A consumer checking their own credit
A hard inquiry occurs when a consumer applies for new credit, such as a credit card or auto loan. These inquiries can affect credit scores and remain on a report for two years. Soft inquiries (like pre-approved offers or self-checks) do not impact scores. See FTC: Hard Inquiries.
In which year was the Fair Credit Reporting Act enacted?
1970
1980
1990
2000
Congress enacted the Fair Credit Reporting Act in 1970 to promote accuracy, fairness, and privacy in consumer reporting. It was later amended by the Consumer Credit Reporting Reform Act of 1996 and the FACT Act of 2003. The FCRA remains the cornerstone of credit reporting regulation. Official history at FTC FCRA History.
Which section of the FCRA sets time limits for reporting negative information?
Section 605
Section 624
Section 603
Section 608
Section 605 of the FCRA establishes the maximum time periods for reporting various types of adverse information, such as seven years for most derogatory items and ten years for bankruptcies. It prevents outdated negative data from unduly harming consumers. Full details are in the statute text at FCRA Section 605.
After a consumer dispute, furnishers must correct or delete inaccurate information within how many days?
30 days
60 days
15 days
90 days
Once a consumer furnishes proof of inaccuracy, the furnisher must investigate and correct or delete the disputed information within 30 days under Section 623. They also must notify all CRAs to which they provided the inaccurate data. Timely correction ensures report accuracy. For more, see FTC Dispute Process.
When must a risk-based pricing notice be provided to the consumer?
Within 30 days after delivering adverse terms
At the time of application
Only upon consumer request
After credit is extended
Section 615 of the FCRA requires creditors who use consumer reports for risk-based pricing (offering less favorable terms) to provide a notice within 30 days of delivering the credit terms. This notice explains how the consumer’s credit report influenced the pricing. It promotes transparency in lending. See CFPB Regulation Z for details on risk-based pricing notices.
Which of these is NOT required in an adverse action notice under the FCRA?
Consumer’s social security number
Name and address of the CRA
Statement of consumer rights to dispute
Statement that the CRA did not make the adverse decision
An adverse action notice must include the CRA’s name and contact information, a statement that the CRA did not make the decision, and a notice of the consumer’s right to dispute under Section 615. It does not require the consumer’s full social security number. This ensures the consumer receives key information without unnecessary personal data. See FCRA Section 615.
Which FCRA section requires consumer reporting agencies to follow reasonable procedures to assure maximum accuracy?
Section 607(b)
Section 616
Section 604
Section 613
Section 607(b) of the FCRA mandates that CRAs must maintain procedures to ensure maximum possible accuracy of the information they report. This includes proper employee training, data sourcing, and compliance reviews. These requirements help protect consumers from errors. Additional guidance is available at FCRA Section 607.
Under the FCRA, who can access a consumer's credit report without specific consent?
An existing creditor for account review
A potential landlord
A prospective employer
An insurance company
Current creditors may perform account reviews or certain monitoring without additional consent under Section 604 as part of an existing credit relationship. Prospective landlords, employers, and insurers must obtain the consumer’s consent before accessing consumer reports. This preserves privacy while allowing ongoing account management. See Permissible Purposes.
In what format must disclosures accompanying consumer credit reports be provided?
Clear and conspicuous plain language
Legal jargon in small type
Summary of obligations only
Verbally over the phone
The FCRA requires that all disclosures, including the Summary of Rights, be provided in clear and conspicuous language under Section 609. This ensures consumers understand their rights without complex legal terms. Disclosures must be in writing or electronic form if the consumer consents. See CFPB Regulation V.
Which event triggers a creditor’s obligation to send a Summary of Consumer Rights?
When providing a free credit report copy
Only when adverse action is taken
During every account review
On consumer request for credit score
Under Section 609 of the FCRA, when a CRA provides a free credit report, it must also include the Summary of Consumer Rights. This summary outlines dispute, access, and deletion rights. It helps ensure consumers know how to correct errors. Details are at FCRA Section 609.
How long does an extended fraud alert remain on a consumer's report?
Seven years
Thirty days
One year
Five years
An extended fraud alert lasts seven years under Section 605A of the FCRA, provided the consumer submits an identity theft report. It offers stronger protection than the initial one-year alert. Users of the report must take additional steps to verify identity. More at FTC Fraud Alerts.
Which of these is an example of a specialized consumer reporting agency?
Check verification services
Equifax
Experian
TransUnion
Specialized consumer reporting agencies compile information on specific types of data, such as check-writing histories or tenant records. They differ from nationwide CRAs like Equifax or Experian. FCRA applies to both nationwide and specialized agencies. See FTC FCRA Definitions.
Which section of the FCRA defines permissible purposes for consumer report access?
Section 604
Section 607
Section 609
Section 611
Section 604 of the FCRA lists permissible purposes for accessing consumer reports, such as credit transactions, employment, insurance underwriting, and certain government licenses. CRAs must certify the purpose to safeguard consumer privacy. Unauthorized access is prohibited. Details at FCRA Section 604.
What is the reinvestigation period for a dispute submitted by a consumer under FCRA Section 611?
30 days
15 days
45 days
90 days
Section 611 requires CRAs to complete reinvestigations within 30 days of receiving a consumer’s dispute notice. This period can be extended by 15 days if the consumer provides additional relevant information. After reinvestigation, the agency must provide the consumer with the results and a free copy of their report if changes occurred. See FCRA Section 611.
If a furnisher determines disputed information is inaccurate, it must notify all CRAs to which it provided that information within how many days?
30 days
45 days
10 days
90 days
Under Section 623, furnishers who correct or delete inaccurate information must notify each CRA that received the original data within 30 days. This ensures all reports are updated promptly. Failure to do so may result in enforcement actions. More at FCRA Section 623.
A consumer under active military duty is entitled to an alert on their credit report for a reduced rate. How often can they request a free report during active duty?
Once per 12 months
Twice per year
Every six months
Unlimited requests
The Military Lending Act and FCRA provisions allow active duty service members one free credit report per year in addition to the annual free report. This ensures soldiers can monitor credit for identity theft while deployed. The rule also caps interest rates and fees on certain loans. Details at FTC Military Alerts.
Which of these best describes a "soft inquiry" under the FCRA?
A report pull that does not affect credit score
An application for new credit
A landlord checking rent history
A denial of credit
A soft inquiry occurs when a consumer or third party checks a credit report for non-lending decisions, such as pre-approved offers or background checks. Soft inquiries do not impact credit scores and are not visible to other third parties. By contrast, hard inquiries result from credit applications and can lower scores. See FTC Soft vs. Hard.
What is the maximum time a furnisher has to notify a consumer of the results of a completed dispute investigation?
Five business days
Thirty days
Ten business days
Sixty days
Under Section 611, furnishers must advise the consumer of the results of a dispute investigation within five business days after completing the process. This prompt notice requirement helps consumers stay informed on any corrections or deletions. Failure to comply may lead to enforcement. See FCRA Section 611.
In a mixed file dispute, where a report contains another consumer’s data, what must a CRA do?
Provide dispute guidance and reinvestigate all records
Ignore the consumer’s dispute
Delete the entire file without review
Transfer dispute to another CRA
When a consumer identifies a mixed file (information belonging to another person), a CRA must provide dispute instructions and reinvestigate under Section 611. The agency must correct or delete the wrong details and notate any changes. This ensures only accurate personal data appears. See FTC on Mixed File Disputes.
Which FCRA section specifically addresses risk-based pricing notices?
Section 615
Section 609
Section 604
Section 613
Section 615 of the FCRA covers risk-based pricing notices, requiring creditors to inform consumers when they receive less favorable credit terms based on information in their consumer report. The notice must explain how to obtain a free copy of the report and a summary of rights. It promotes fair lending practices. Reference CFPB Regulation Z.
Which of the following constitutes an adverse action under the FCRA?
Denying a credit application
Offering a lower interest rate
Sending promotional mail
Updating account review
An adverse action under Section 615 includes denial of credit, increased interest rates, or reduced credit limits. Adverse actions require a formal notice to the consumer. Positive outcomes or routine reviews are not adverse. For definitions, see FCRA Section 615.
Under the FCRA, how long will most bankruptcy information remain on a credit report?
10 years
7 years
5 years
3 years
Bankruptcy information can remain on a credit report for 10 years for Chapter 7 and seven years for Chapter 13 under Section 605. This longer period reflects the severity of bankruptcy in credit history. Accurate dating is essential for report compliance. See CFPB Bankruptcy Information.
What is the purpose of the "Summary of Consumer Rights" under the FCRA?
To inform consumers of their FCRA rights
To provide credit scores
To list all furnisher contacts
To advertise credit products
The Summary of Consumer Rights, required by Section 609, educates consumers about their rights under the FCRA, including dispute procedures, access rights, and how to correct errors. It must accompany credit report disclosures. This transparency empowers consumers. More at FCRA Section 609.
Under FCRA Section 609, within how many days must a CRA provide a consumer’s full file disclosure after receiving a request?
30 days
15 days
45 days
60 days
Section 609 requires CRAs to provide full file disclosures within 30 days of receiving a consumer’s written request and proper identification. They may charge a reasonable fee unless the disclosure is free by law. This ensures consumers access their complete credit file promptly. See FCRA Section 609.
What is required when a user sends firm offers of credit under prescreen rules?
They must provide a clear opt-out form
They must obtain advance consumer consent
They must send offers only by email
They must include the consumer’s SSN
Under FCRA prescreen rules in Section 604, firms sending pre-approved credit or insurance offers must include a clear method for consumers to opt out, either permanently or for five years. This prevents unwanted solicitations and protects consumer privacy. More at FTC Prescreen Offers.
Which section of the FCRA governs affiliate marketing disclosures and opt-in requirements?
Section 624
Section 615
Section 604
Section 607
Section 624 regulates affiliate marketing by requiring clear and conspicuous disclosures and an opt-in from consumers before sharing information with affiliates. This provision enhances privacy protections when data is shared within corporate family entities. See FCRA Section 624 for details.
If a CRA decides not to delete or modify a disputed item, they must allow the consumer to include a statement in their file. What is the word limit for this statement?
100 words
200 words
50 words
250 words
Under Section 611, if a consumer challenges information and the CRA upholds it, the consumer may add a brief statement explaining their position, limited to 100 words. This statement will be included in future reports. It ensures the consumer’s perspective is recorded. More at FCRA Section 611.
Which Regulation implements the FCRA’s identity theft red flag rules for financial institutions?
Regulation V
Regulation Z
Regulation B
Regulation X
Regulation V, issued by the CFPB, implements the FCRA’s identity theft red flag rules under Section 114 of the Fair and Accurate Credit Transactions Act (FACTA). It requires institutions to develop and maintain programs to detect, prevent, and mitigate identity theft. Compliance guidance is detailed at CFPB Regulation V.
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Study Outcomes
Understand FCRA Fundamentals -
Grasp the essential provisions and objectives of the Fair Credit Reporting Act to build a solid compliance foundation.
Identify Consumer Rights and Obligations -
Recognize key consumer entitlements under FCRA, including disclosure, dispute, and credit report access rights.
Apply Compliance Principles -
Implement best practices for credit reporting agencies and furnishers to ensure adherence to FCRA requirements.
Analyze Realistic FCRA Scenarios -
Evaluate practice questions based on realâ€world cases to sharpen problemâ€solving skills for the Fair Credit Reporting Act test.
Evaluate Reporting Procedures -
Assess correct steps for credit report handling, dispute resolution, and adverse action notices in line with FCRA standards.
Cheat Sheet
Core FCRA Provisions -
The Fair Credit Reporting Act mandates that consumer reporting agencies maintain accurate, complete, and private credit data, as outlined in Section 607. Use the "6Cs" mnemonic - Consumers, Compliance, Creditors, CRAs, Consent, Correction - to recall the act's essential elements. These provisions frequently form the backbone of FCRA practice questions on any FCRA compliance quiz.
Consumer Access and Rights -
Under FCRA, every consumer is entitled to one free credit report per year from each major CRA and additional free reports after a denial of credit or employment within 60 days. Recall the "1-0-60" rule: one free annual report, zero fees, and a 60-day dispute window post adverse action. Quizzing yourself on these timelines will boost your FCRA basics quiz performance.
Permissible Purposes for Disclosure -
FCRA restricts disclosure of credit reports to eight permissible purposes, such as credit underwriting, employment screening, insurance, and government licensing. A handy mnemonic is "CEPP PAGS": Credit, Employment, Public benefit, Processing, Purchase, Account review, Government license, Subpoena. Mastering these categories is crucial for acing the Fair Credit Reporting Act test.
Adverse Action Notice Requirements -
When adverse action is taken, FCRA requires the user to provide a notice containing the CRA's name, a statement of rights, and specific credit decision factors. Think of the "5Rs" checklist: Reason, Referral to CRA, Rights statement, Resource link, Remedies available. Realistic FCRA practice questions often hinge on correctly identifying these notice elements.
Dispute and Correction Procedures -
Consumers can dispute inaccurate items, forcing CRAs and furnishers to investigate within 30 days and remove unverified data. Use a standard dispute letter template - cited by the FTC - to ensure it includes your identifying info, item descriptions, and a clear "Please investigate" statement. Practicing dispute scenarios will sharpen your skills for any FCRA compliance quiz.
