Credit report complaints highlight errors
New data details consumers' most-common gripes
One out of five people who complained about their credit report said it contains information that does not even belong to them, according to newly released figures.
The Consumer Financial Protection Bureau on May 31 released detailed records of 6,736 complaints about credit reports, which it began collecting in October 2012.
Problems with the reporting of account status -- which could include late payments or accounts being in collections -- led the list of problems, with 26 percent of complaints. Twenty-one percent of people complained their report contained information that simply wasn't theirs.
Overall, complaints about some form of incorrect information made up 66 percent of the total gripes. Among other problems: 15 percent took issue with the reporting company's investigation of a dispute; 11 percent were unable to get their credit report or score; 6 percent said their credit report had been used improperly.
The addition of credit reports was part of a broader update of the consumer protection bureau's complaint database. The update also added grievances about money transfers, plus a previously unavailable state-by-state breakdown of complaints.
"This data puts valuable information in the hands of consumers to help them understand what is happening in their states," said Richard Cordray, director of the CFPB, the federal agency that acts as a consumer financial watchdog. "And by adding credit reporting and money transfer issues to the Consumer Complaint Database, we are making these important markets more transparent and accountable to all consumers."
The newly published data showed that the large credit bureaus had different complaint profiles. Experian had the most gripes, with 2,596, followed by Equifax with 2,279 and TransUnion with 1,635.
It's an opportunity to look at what consumers are saying.
|-- Norm Magnuson
Consumer Data Industry Association
The companies' responses to complaints also varied widely. Equifax was most likely to resolve a problem with some form of concession or relief to the consumer, either monetary or nonmonetary, at 55 percent. TransUnion followed with 24 percent and Experian at 1.4 percent. Experian reported a relatively high 18 percent of its responses as "in progress."
Each of the large credit bureaus has files on roughly 200 million Americans, according to the Consumer Data Industry Association. The CFPB complaint data reflects a small fraction of total credit reports, but provides a breakdown of specific problems that consumers are having, and tracks the issues by company.
"It's an opportunity to look at what consumers are saying," said Norm Magnuson, vice president for public affairs of the association, which represents the interests of the credit reporting agencies.
Complaints often result from information that is supplied by a lender or other reporting entity, Magnuson said. In addition, while errors should be corrected, he said, not all errors have enough of an effect on a person's credit to influence their credit score, or their chances of being granted a loan.
Errors on credit reports have been under a magnifying glass since the Federal Trade Commission in February found that one in five American consumers has a material error on their report from one of the three large bureaus.
The CFPB complaint data, which now includes 113,000 records, also encompasses gripes about credit cards. In February, an analysis by CreditCards.com showed credit card complaints by ZIP code. The newly available geographic analysis adds to that picture, showing that the top states for credit card complaints, on a per capita basis, are the District of Columbia, Delaware, Maryland, New York and New Jersey.
See related: FTC: 1 in 5 Americans has a mistake in credit report
Published: May 31, 2013
- Debt-free seniors may find themselves unscorable – Congratulations! You've paid off your mortgage and all other debt. But you may have lost something else in the process: your credit score ...
- Average credit score climbs in Experian study – The U.S. consumer's average credit score rose 4 points in the past year, nearing pre-recession levels, according to the credit bureau Experian ...
- Fraud alerts: Your credit's first (and free) layer of security – A fraud alert notifies lenders that they should take special precautions to verify your identity before extending credit. But it comes with limitations -- and hassles ...