Consumers May Have to Fight to Get Errors Corrected on Credit Reports

The current economy is challenging enough; consumers shouldn't also have to worry about errors on their credit reports. However, according to a major year-long expose' by The Columbus Dispatch, getting errors erased from your credit report can be a daunting process.

The three major credit agencies, Equifax, Experian, and TransUnion, produce over three billion credit reports in a year. Credit reports are important because they contain information about credit cards, mortgages, other types of consumer loans, and bankruptcies, and are used by banks, employers and insurers, among others, to assess an individual's suitability for a variety of resources and opportunities.

The last thing consumers want is to have such vital decisions based upon erroneous information that often they cannot get fixed.

The report analyzed almost 30,000 complaints filed with the Federal Trade Commission (FTC) and with the attorneys general of 24 states. The complaints cited breaches of the Fair Credit Reporting Act (FCRA), the federal law governing disputes over credit reports, where often individuals could not get even glaring mistakes such as wrong names and birthdates corrected.

It is estimated that about 25 percent of all the reports contain serious errors. Further, the National Consumer Law Center has stated that the "dispute process mandated by the Fair Credit Reporting Act has become a travesty, with the credit bureaus conducting perfunctory investigations by translating detailed written disputes into two or three digit codes and paying foreign workers as little as $0.57 to process each dispute."

Hopefully, due to the attention that has been drawn to this issue, help is on the way. Both attorneys general in many states and the new federal Consumer Financial Protection Bureau (CFPB) have vowed to take up this cause on behalf of consumers. Under the provisions of the FCRA, attorneys general have the ability to file lawsuits against the credit agencies. Further, President Obama has stated that the CFPB will make oversight of these agencies a main concern. The CFPB is expected to release its strategy for regulating the credit agencies in July 2012.

In the meantime, you can protect yourself by requesting free copies of your credit score from all three agencies. If you encounter errors and have no success getting the credit agencies to fix them, consider consulting an attorney to help you with the next steps in repairing your report and holding the credit agencies accountable.