California Credit Reporting Laws
California enforces some of the strictest credit reporting laws in the country through the California Consumer Credit Reporting Agencies Act (CCRAA) and related state legislation, providing several protections that go significantly beyond the federal Fair Credit Reporting Act (FCRA)
California Prohibits Reporting Medical Debt on Credit Reports
As of January 1, 2025, Senate Bill 1061 made it illegal for healthcare providers, billing vendors, and collection agencies to report medical debt to consumer credit bureaus. Lenders are also explicitly prohibited from using medical debt as a factor when making credit decisions.
With Few Exceptions, Potential Employers Cannot Check Your Credit
California Labor Code 1024.5 prohibits employers from pulling consumer credit reports for hiring or promotion purposes. Exceptions are strictly limited to specific roles, such as sworn law enforcement, managerial positions, or jobs with direct signatory financial authority or regular access to $10,000 or more in cash.
Background Check Protections
If a criminal arrest did not lead to conviction or a pardon was granted for a criminal conviction, California law requires that this information must be removed from all consumer credit reports.
California law requires ALL records ofarrest, indictment, information, misdemeanor complaints be dropped from consumer credit reports after seven years has passed from the date of disposition, release, or parole.
Enhanced Protections for Victims of Identity Theft
Under California Civil Code § 1785.15.3(b), a consumer is legally entitled to one free credit report per month for 12 consecutive months, if they provide the credit bureau with a valid identity theft police report (filed under California Penal Code § 530.6) or a Department of Motor Vehicles investigative report.