As news from the February 10th 60 Minutes piece generates headlines across the country, we at Traywick Law Offices ask: "How can this be a surprise to anyone?" That the credit bureaus--Experian, TransUnion, Equifax--carry countless mistakes on their books has been obvious to us for years: we find these mistakes for TLO clients on a regular basis. We also know that state and
federal law provide powerful tools to consumers in South Carolina which empower people hurt by these very powerful corporations, with whom most people never have transacted any business.
As 60 Minutes points out, the credit bureaus like to blame the banks, credit card companies and other corporations for making erroneous reports about the public's creditworthiness. The truth, though, is that when you are denied a loan for a car, or when the seller agrees to finance you but at a much higher interest rate than is rightfully yours, the decision is made largely by reference to your credit report, which is provided by Experian, Equifax or TransUnion. When a bank refuses a mortgage loan, that person's credit bureau report was one of the first things the bank considered.
As we wrote in a recent blog post, an adverse credit score puts the person subject to it in a highly disadvantageous financial situation. He or she is no longer on a level playing field with folks who enjoy a high credit score. In fairness, it is true that there is shared responsibility here: credit bureaus who are provided false information by a bank or credit card company certainly are in a difficult position. Regardless, though, given how important the credit score is to individuals, one would think the credit bureaus would take their responsibility to keep their reports accurate very seriously.
As America saw on 60 Minutes, that appears not to be the case: multiple year fights to fix errors are commonplace, red tape is endless. Not surprisingly, the credit bureaus declined to appear on the program to explain themselves. The truth is this: credit bureaus' bottom lines are not helped by spending money and time in receiving, considering and acting on consumers' complaints that their credit reports are inaccurate. So the tools available to dispute information reported erroneously are inadequate and consumers are forced, basically, to turn credit report disputes over to an attorney with experience handling
Fair Credit Reporting Act claims. Credit bureaus make money by providing credit reports to lenders for a fee. They make no money by investigating erroneous reporting; these investigations, so important to consumers, are an unwanted hassle to credit bureaus, a waste of time and money, lost profit.
And it is for precisely these reasons that every American has a right--granted by the federal government--to secure his or her credit report once per year. From this report you can learn what credit bureaus are reporting about you, and you can verify--line by line, item by item--whether their reporting is accurate. Considering that 60 Minutes reported that one in five credit reports contains errors, and that one in ten contains an error that may affect the person's credit score--one story on the program involved a South Carolina man whose credit report contained a mortgage foreclosure that was not his!--TLO highly recommends that each person check his credit score annually.
If you believe the credit bureaus have on their books or are reporting inaccurate information about you to lenders, call us to learn about the tools the law provides to ensure fair treatment by, and just compensation against, the credit bureaus and the financial institutions who provide information to them.