Is a bank obligated or required to report information on your credit report?

I was reading this question and I thought that banks did not have to report information about a loan to the credit reporting bureaus if they did not want to but I can't find any supporting evidence for that position.

Is a bank obligated or required to report information on your credit report?

Is there any incentive to the banks to report information on your credit report? They already know how the loan they are servicing is going so they won't gain additional information from doing so.

I'd love sources on any answers if at all possible.

2 Answers 2


In the United States, nobody is obligated to report information on your to the credit bureaus. Doing so is an incentive they hold to keep you honest. If repossession of an item isn't an option, lenders have little recourse besides hurting your credit. It isn't all that hard to declare bankruptcy, and lenders aren't allowed to threaten (or act on) you with harm.


Furthermore, companies aren't even required to report accurately it seems. The law simply says that you can have it corrected, not that companies are bound for accuracy in the first place.

  • 1
    "companies aren't even required to report accurately it seems" -- I'm not familiar with how that part of the law works, but improperly reporting negative credit seems like it could leave a bank open to some type of defamation charge?
    – bstpierre
    Commented Sep 12, 2010 at 1:25
  • @bstpierre - that would makes sense huh. All they have to do is correct something if you challenge it. If they can't prove an item they remove it. That is why some enormous percentage of people in the US have errors on their reports.
    – MrChrister
    Commented Sep 12, 2010 at 17:49
  • Most of the errors on credit reports are typographical errors when information is keyed into the system. For instance, accidental transposition of an account number, amount or SSN means the information ends up being inaccurate. The creditor's system should have safeguards against such things, but it happens. Many times too, errors come from what the borrower has provided themselves through web sites. How many times have you accidentally put the wrong phone number or made a mistake entering an address? Commented Feb 15, 2017 at 20:26

It's very difficult to "require" accuracy in anything, especially when companies are dealing with such huge volumes of data. Everything from your credit report to medical files to your tax records have errors in them because first and foremost, they're entered by humans, who make mistakes. It often begins with people/customers providing (or entering) incorrect information on accident, such as transposing a digit in an account number, telephone number, or address, when filling out a document or web form.

Sometimes information has to be manually entered from one system to another, which introduces another opportunity for errors to occur. Whenever you call in a payment by telephone or mail a check, it may be necessary for someone to key in the information, which means mistakes can happen there also.

Could companies do a better job of being more accurate? Sure they could, but it would be hugely expensive, which would naturally equate to higher prices that aren't justified by the results.

Trying to hold them legally accountable for inaccurate information is problematic, because you're expecting the system to be more perfect than the humans running it. There's no way for any company, no matter how diligent, to be 100% accurate 100% of the time, and I can't imagine a scenario whereby a court would attribute liability to a company for what is a defensible argument of inadvertent error.

  • Hi Daniel, Your answer talks about the accuracy of information. My question was mainly about whether there was a requirement to report information in any form whatsoever. For example, if I started a mortgage company, would I be required by law or incentivized by regulation to report the borrower's behavior to the credit bureaus?
    – Alex B
    Commented Feb 19, 2017 at 5:19
  • No, there is no legal requirement at all for any creditor to report the payment histories of its customers if it chooses not to, and there are many creditors who don't participate. Commented Feb 19, 2017 at 19:35

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