When Your Credit Is Killed And It's Not Your Fault: Can You Sue?

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When Your Credit Is Killed And It's Not Your Fault: Can You Sue?

15 July 2016
 Categories: Law, Articles

In today's economy, almost every financial decision you make is based on your credit score. If your score is bad, landlords can refuse to rent to you, you often can't buy a car or a house, and even small lending, like purchasing furniture on a payment plan, becomes difficult. It can takes years to recoup your score and get into good lending graces, so if your credit was destroyed by bad reporting, inaccurate collections, or identity theft, you might be looking for a way to take back what you have lost. Can you sue for damages to your credit? Here is what you need to know.

Know who to dispute the problem with.

The best way to explain who is actually responsible for your credit woes is through an example. If your internet company starts coming after you for unpaid bills, this affects your credit score. However, if your bills were actually paid in full and you are wrongfully sent to to collections for money owed, you might think the best plan of action is to go after the lender (in this case, your internet company) for their reporting mistake. However, under the law, you can't actually sue a lender for messing up your credit score when they make a mistake. Instead, you need to dispute it with the credit reporting companies that create your score, even though they are only acting on what they have gathered from your apparent lending history. 

Generally, it won't come to a full blown legal fight. You can hire a lawyer to help you send a letter showing the error in reporting and asking for your score to be amended properly. If they refuse to correct the score and pay you for financial advantages, you can then take the civil suit to court.

Know what damages you can collect.

So, what financial damages can you hope to collect from suing for bad credit? Here are some examples:

  • When you have poor credit, if you can secure a loan, those loans will come with higher interest rates because you are a high-risk borrower. Your lawyer can help you calculate how much money you would have saved had you been able to secure the loan with the proper credit score. This money from saved interest can be paid out as damages.
  • You cannot secure a loan because of bad credit. For example, if you want to buy a house, but are turned down due to a poor credit score, you are forced to rent instead. That rent money would have paid a mortgage, and is therefore lost equity on your part. 
  • You were unable to purchase home or rent in a better area because a landlord would not rent to someone with damaged credit. Your home might have been broken into and the resulting financial loss could be counted as damages. 
  • You suffered emotional damages because of the reported score. Often, a credit check is run for family law situations, such as when you want to get custody or adopt a child. Good credit indicates financial stability, and you can sometimes be turned down for custody of a child or for adoption if your credit report shows activity that is financially irresponsible. Not being able to move forward with a perfectly legitimate custody or adoption case is grounds for emotional distress damages in a lawsuit.
  • Punitive damages can be charged if the credit reporting company is shown to be negligent. Punitive damages are meant to prevent the mistake from happening again

If your credit has been wrongly destroyed, you should contact a personal injury lawyer from a firm like Trump & Trump to help you begin your dispute against the reporting agency. You don't have to live with an unfair score, and you could be only a dispute letter away from collecting the money owed to you and living with the freedom that good credit allows.