andyetf

Accuracy in credit reports

In Uncategorized on May 26, 2011 at 7:52 am

From today’s New York Times editorial:

The credit reporting industry has vast reach and power. The information it gathers and sells is used to determine eligibility for credit cards, mortgages and even some jobs. Federal regulators haven’t had the authority or the means to protect consumers who have been victims of inaccurate reports. The new Consumer Financial Protection Bureau will have that authority. It has a big job ahead.
Reporting agencies gather consumer payment histories from creditors that are sometimes less concerned with accuracy than they should be. Those aren’t the only problems. As The Times reported earlier this month, the agencies sometimes merge the credit records of people with similar names and Social Security numbers.
Estimates of the error rate in credit reports vary anywhere from 3 percent to 25 percent. But even 1 percent would mean that two million people could be saddled with erroneous credit histories that cause them to pay higher interest rates or to be denied credit altogether.
Judy Johnson of Louisiana told The Times about how a credit reporting company confused her records with those of another woman. She tried for nearly seven years to get a credit bureau to correct errors in her record, finally suing the reporting company after being denied a credit card. She has since reached a settlement, but a sheriff recently showed up at her door to serve her papers for a debt she says she does not owe.
Its important to check your credit report. I obtain a credit report for all my clients when preparing a bankruptcy case. Its just as important to check your credit report at the end of the bankruptcy. You want to see that the credit agency shows the debts as discharged by the bankruptcy. You need to bring errors to the attention of the credit agency. Write to them. They must respond within 30 days.

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