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credit reporting errorEarlier this year the Federal Trade Commission completed a multiyear study of credit reporting errors and found that nearly 20 percent of consumers had errors in at least one of their credit files, and that 13 percent saw an improvement in their scores when the errors were corrected.

Confused files, like Ms. Thomas’s, are also common. A 2012 study by The Columbus Dispatch analyzed 30,000 complaints to the F.T.C.; of those, 1,500 people reported that their files included someone else’s information. Nearly a third said the credit agencies did not correct the errors, despite being asked to do so.

Most egregious, almost 200 people said their reports showed them as deceased.

Consumer complained to a credit bureau reporting that he is dead. Was told that it had investigated and verified the report of his death.

Only now, decades after Congress established the reasonable-invescredit reporting errorstigation requirement, are credit bureaus experimenting with sending lenders the actual consumer complaints. In theory, the Consumer Financial Protection Bureau could do more to make the investigations more aggressive — but unfortunately, the bureau, still in its infancy and embroiled in disputes over whether its director was properly appointed, hasn’t done so.

In short, it’s up to Congress to act to curb credit reporting errors. It could, for one thing, improve accuracy by imposing liability on lenders for failing to conduct investigations when consumers complain to them. As it stands, consumers cannot sue lenders for failing to investigate without first complaining to a credit bureau, something consumers may not know to do. If consumers had greater rights against lenders, no doubt lenders would be more cautious about the accuracy of their records.

40 Million Mistakes: Is your credit report accurate? a 60 Minutes expose, February 10, 2013

A mistake on your credit report can cost you money. It can increase the interest you pay on loans, prevent you from getting a mortgage or buying a car, landing a job or getting a security clearance. Its not uncommon. A new government study to be released tomorrow indicates as many as 40 million Americans have a mistake on their credit report. Twenty million have significant mistakes.

And our own investigation of the credit reporting industry shows that those mistakes can be nearly impossible to get removed from your record.

We have several videos on our web site.  Below is one that might be of interest:
  • “Meet Ms. Drain and Suggestions on How to Hire an Attorney”

Additional resources:

MUSINGS BY DIANE: “You will never understand the real pain caused by these credit reporting errors, unless you have been denied the ability to buy a house, finance a surgery or rent an apartment as a result of an error on your credit report. The credit reporting agencies have a special list of members of Congress, other lawmakers, special dignitaries and people in powerful positions – economic or political. That list is used to insure these folks will not have errors on their credit reports.  That way they don’t feel the impact that 40 million people feel due to the credit reporting errors.”