Articles Posted in Credit Reports has a report on some relatively unknown credit reports. For example, Equifax has a report it calls “work number” that provides employment and income verification data obtained from private companies. Fannie Mae said mortgage companies could use this report in lieu of pay stubs effective mid-2016.

Landlords often look at applicants’ credit reports before deciding whether to rent an apartment or other living space. There are many such credit reports that include former addresses, eviction history and the like.

Cable companies and utilities have an “exchange” with information on customers’ history of paying their cable or utility bills, connection requests, defaults, and fraudulent information.

Banks and other financial institutions typically won’t open an account if someone has an adverse history as reported by specialized reports on consumers’ account activity.


The American Banker magazine has an article that asks “Can credit bureaus can finally be tamed?”

The article describes a “tough fix-it order” imposed by federal and state officials that was supposed to force the bureaus to clean up inaccuracies and better respond to consumer complaints. But that happened 25 years ago and the problems with the bureaus persist.

The article notes that lawyers, advocates and regulators agree that problems of accuracy and how disputes are handled continue to be problems. In 2012 the FTC found that one in four consumers have potential mistakes on their credit reports and one in 20 may have errors significant enough to negatively impact how much he or she pays for a loan, or whether credit is available. That means 11 million consumers have material errors on the reports that may affect whether they can get a mortgage loan, a car or even a job. In 2014, the Consumer Financial Protection Bureau received 45,000 complaints about the credit bureaus.

Consumers have a right to dispute inaccurate or misleading information on their credit reports. The problem is the process does not work very well for consumers. Chi Chi Wu of the National Consumer Law Center describes the dispute process as a “Kafkaesque.” Instead of conducting substantive investigations when consumers lodge a complaint, the bureaus have typically relied on an automated system that boils down concerns into two- or three-digit codes that are sent to the creditors and others (the furnishers). Those furnishers often do little more than check to see if the data in their systems matches what’s in the report and, to compound the problem, the credit bureaus typically accept whatever the furnishers say.  This practice, known as “parroting” is contrary to the dictates of the FCRA.

The three credit bureaus makes tons of money selling consumers credit monitoring and education products. In this business, the bureaus profit from consumer insecurity about stolen credit information and identity theft. Those fears, along with general concerns about credit reporting errors, drive the sale of monitoring products, which go for as much as $19.95 a month. The products can provide a false sense of security because they only monitor certain kinds of fraud. Experian boasted in an investor presentation in May that consumer monitoring and identity protection accounted for 21% of revenue last year. Equifax, meanwhile, reported to the SEC in April that its “personal solutions” segment — products sold directly to consumers, including monitoring services — earned the company over $65 million, about 10% of total operating revenue for the first quarter of 2015.  In this way, the agencies profit from their own inaccurate information.

A major change is that the industry now has oversight from the Consumer Financial Protection Bureau. The CFPB vows to force changes in the industry to protect consumers. One CFPB investigation is apparently underway concerning the industry’s sales of credit scores and credit monitoring products. Equifax disclosed to the SEC some months ago it received a civil investigative demand from the CFPB back in February 2014 “as part of its investigation to determine whether nationwide consumer reporting agencies have been or are engaging in unlawful acts or practices relating to the advertising, marketing, sale or provision of consumer reports, credit scores or credit monitoring products.” Experian told analysts last summer that it got a similar request.


The January 2015 issue of Consumer Reports has an excellent article on credit reports. It is especially useful for any consumer who discovers a problem with his or her reports, but does not know how to begin to fix the problem. The article has specific advice on how to dispute errors in the reports. It also describes what goes into consumers’ credit scores and ways to rehab your credit score.

Many of you know you can get free credit reports once a year from Experian, Equifax and Trans Union by going to (or you may call 1.877.322.8228 and use the prompts). But what you may not know is that there are quite a few other credit-related reports you may obtain that relate to your credit standing. These reports may be useful in checking for ID theft or the source of inaccuracies in your credit history. Some of the more useful reports are as follows:

1) Public Records. LexisNexis Personal Reports contain information on public records relating to property you have purchased or sold, criminal history, liens and bankruptcy. You may request a copy of your LexisNexis report by sending a request via or you may call 1.866.312.8102 for information on how request your report.

2) Check Writing History. Banks report bounced checks to three companies. You may get your Chex Systems report by calling 1.800.428.9623 or go to  You may get your Certegy Check Systems report, by calling 1.866.543.6315 or go to For TeleCheck call 1.866.543.6315.

3) Health Care. Call The insurance industry reports health related data to the Medical Information Bureau. To get your report, you may call 1.866.692.6901 For prescription histories call Milliman IntelliScript at 1.877.211.4816 or go to or call Optum MedPoint at

4) Insurance Claims. LexisNexis has reports on auto and property loss claims, the Lexis/Nexis Comprehensive Loss Underwriting Exchange (CLUE). There is also a similar report available from Verisk-A-Report, 1.800.627.3487 or go to (type “order free report” in the search box).

5) Rental History. CoreLogic has rental histories. Call 1.888.333.2413 or go to pages/Safe-Rent-Consumer.aspx.

These companies are subject to the Fair Credit Reporting Act in many respects. Under the FCRA, they are required to give you your report at no charge once a year.

For a complete list of companies that produce speciality reports go to the Consumer Financial Protection Bureau’s website,, and then search for “consumer reporting agencies.”

Here are some of the most common myths concerning credit reports.

1) I haven’t done anything wrong so my credit reports must be OK. Your credit reports may have errors that affect your credit standing even if you did nothing to cause the errors. By some estimates, 70% of credit reports have errors. The errors may be lowering your credit score, which will mean you may have to pay a higher interest rate on credit. Morale to this story is to periodically download your credit reports and check for errors. If you find any errors, send dispute letters to the credit reporting agency.

2) Checking credit reports will hurt my credit score. You may check your own credit report as often as you like. There will be effect on your credit score. Confusion may arise from the fact that when you apply for credit and the creditor pulls your credit report, a hard inquiry will appear on your credit report. Excessive numbers of hard inquiries will lower your score somewhat. If you are shopping for a mortgage or car, you may end up with a lot of inquiries, but FICO, the leading source of credit scores, will count inquiries for a car or mortgage in any 30 day period as just one inquiry.

3) If you pay off a delinquent debt, a missed or late payment will be removed from your credit report. Paying off a debt will not remove negative history. The debt will fall off your report once 7 years is passed from the date for first delinquency. Do not believe credit repair companies that promise they can get negative accounts removed.

4) It will help my credit score if I make a payment on an old debt. Payment on an old debt or even paying it off is usually not a good idea. The negative history on the account won’t disappear from your credit report. Plus you risk restarting the statute of limitations in some cases. Paying off a recently incurred debt may make sense. While the history will not disappear, the balance due will reduce to zero which is a positive in terms of your credit score.

5) I need assistance of a debt settlement company. Don’t even think about it. These guys are scam artists. You will just be throwing money away. If you want to negotiate settlements with your creditors, do it yourself. Debt collectors will typically settle debts for some percentage of the debt.

6) It is a good idea to close a credit card account after paying it off. This can actually hurt your score–it eliminates some of your credit history, which is about 15% of your credit score. Plus, closing a credit card account means your utilization or debt to credit ratio will worsen. You can always cut up the card and not use it.

7) Keeping a balance on credit cards improves the credit score. Keeping a balance only costs you interest. Opening a credit card and keeping payments current can help build your credit history if you don’t have much credit history.

8) Daily credit monitoring is  good idea. Some people like daily monitoring, but it is expensive and you can check your own credit reports from Experian, Equifax and Trans Union once a year for free at You can download one of them every four months for free.

9) You cannot get credit if you file bankruptcy. You may be able to get some credit, but it will be costly.

10) All credit scores are alike. FICO is a company that provides the scores most commonly used by creditors. The scores provided by Experian, Equifax , Trans Union and many others are not used all that often by creditors. Which is why they are sometimes called “fako” scores.

Parents should periodically check their children’s credit reports. The reason is that fraudsters sometimes steal the kids’ identity. They know that children likely won’t notice their identity has been stolen and parents don’t typically check their credit reports. A good time to check is when a child is 16. At that point, there is time to take action to correct the reports.

Children should not have credit reports and so if there is a credit report it may be because someone has stolen the child’s identity. A research firm found that one in 40 households with children under the age of 18 had at least one child whose personal information was affected by identity theft.

According to the reasons to be concerned about such identity theft include the possibility a debt collector may harass a child to pay a debt, a child might not be able to open a checking account due to negative credit history that does not belong to the child, or when the child applies for a driver’s license, the child may find someone else has obtained a license in the child’s name.

As everyone knows, foreclosures and accompanied recession caused tremendous economic damage affecting millions of consumers. These events have adversely affected the credit standing of millions of our citizens. The National Consumer Law Center has published an excellent report describing the problem and what should be done to mitigate the problems.

Consumers who lost their homes due to foreclosure inevitably end up with a report of a foreclosure on their credit reports. These reports knock their credit scores down by 100 to 150 points. Even when a homeowner avoided foreclosure by resorting to a short sale, a loan modification, or deed-in-lieu, the owner’s credit score was adversely affected.

The banks and credit reporting agencies have not lived up to the requirements of the FCRA in many cases in reporting on such real estate transactions. For example, some lenders, such as Chase Bank, report that a foreclosure was started and that the property was sold for less than full value when what really happened is that the property was sold in a short sale. When someone pulls the consumer’s credit report, what is reported is a foreclosure rather than short sale. Under various lending programs, a consumer is eligible to get a new home loan with a short sale having been reported, but not if the report merely references a foreclosure.

When a lender agrees to a loan modification, the results are not always accurately reported to the credit reporting agencies. Worse, some lenders agree to a modification, the owner makes all required payments on a timely basis, and the lenders turn around and trash the owner’s credit reports by reporting they paid late. Such reporting is a violation of the FCRA.

There are many ways to reform the way the agencies report on these events. The NCLC report has some suggestions for reform.

Yesterday’s NYTImes has an op-ed how the credit bureaus sometimes mix the files of one consumer with another. Mixed files result when a credit bureau issues a report on a consumer that includes the credit files of a different person. When the other person has negative accounts like charge-offs, repossessed car loans, etc. the innocent consumer cannot get credit from banks, can’t open a checking account, can’t get a car loan, etc.

The op-ed piece gives the Judy Ann Thomas case as an example. She lived in Ohio, but the credit bureau mixed applied for a loan. But the bank mixed up her record with the file of a Utah woman.

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 some other person’s credit information. Nearly a third said the credit agencies did not correct the errors after being asked to do so.

The bureaus are supposed to conduct reasonable investigations, but typically they are cursory.

We have a number of mixed file cases pending. If you believe your credit reports have accounts belonging to someone else, you should first send letters to the bureaus complaining about the errors. If your reports are not promptly fixed, please contact us. has an informative report on who is permitted to view consumers’ credit reports. The FCRA limits access to persons with a “permissible purpose.” Persons may access a consumer’s credit files if the consumer gives written consent or in connection with a credit transaction to which the consumer consented. Persons may also access a consumer’s credits for the purpose of checking an applicant’s employment history, in connection with an application for insurance, and for other limited purposes.

The most common permissible purpose violation is in the case of identity theft. describes a case in which a clerk at a law firm that was representing a mortgage company who misused a consumer’s credit report. The firm had legitimate access to the credit reporting system, but the rogue employee used it to set up credit cards and get loans in consumer’s name.

Some cases arise out of family legal cases. If one spouse or his or her attorney pulls a spouse’s credit report, there may be a violation of the FCRA.

The key to checking to see if someone is illegally reading your credit report is to look in the inquiry section. If you see anything you didn’t set in motion (such as a loan or credit card application), make sure to investigate.

An exception is a bank or credit union’s pre-screening before sending you a credit card offer, but any such inquiries will be clearly marked as promotional. Those inquiries are called “soft pulls” of your report and do not impact your credit score.

The Consumer Financial Protection Bureau has released a study of the operations of the three national credit bureaus.

The CFPB found serious problems with the credit reporting system, and in particular, the dispute system.The bureaus’ automated dispute system in which the credit bureau often limits its role in disputes to little more than assigning codes as to what type of dispute is at issue. The bureaus do not examine documents, contact consumers by phone or email, or exercise any form of human discretion in resolving a dispute.

The vast majority (85%) of credit reporting disputes are passed on to the company (known as a furnisher) that provided the information. However, the documentation consumers mail in to support their cases is virtually never sent to furnishers for them to properly investigate and report back to the credit reporting company.

In 2009, the National Consumer Law Center documented the same problems with the credit reporting dispute system and the potentially devastating impact on consumers who can’t get errors in their credit reports corrected in their own report available on the NCLC website, Automated Injustice: How a Mechanized Dispute System Frustrates Consumers Seeking to Fix Errors in Their Credit Reports.

The CFPB report said a different system is needed for dispute resolution with respect to reporting by debt collectors, who generate 40% of disputes to the credit bureaus despite constituting only 13% of the accounts in credit reports.

Debt collectors have little incentive to correct errors in response to a dispute as removing negative information means losing the opportunity to collect the debt. Their main objective is to get paid and they don’t care about their relationship with the consumer. They don’t even care if they have the wrong person–they just want to get money.