BACK

SrdjanPav / E+ / Getty Images

In the News

COVID-19 pandemic spurs outbreak of credit report errors

A consumer advocate group says credit reporting complaints surged by 60% in 2020, with the biggest jumps starting in April

Summary

Data from the U.S. Public Interest Group show consumer complaints about credit report errors surged by 60% year-over-year in 2020. It’s due in part to creditors reporting consumers as late on payments even though they allowed them to skip amid COVID-related job losses.

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

Ripple effects of the COVID-19 pandemic keep coming, and your credit report could be one of the victims.

The U.S. Public Interest Research Group, a consumer advocacy organization, has studied the number of complaints the Consumer Financial Protection Bureau (CFPB) received in 2020 versus 2019 regarding credit reporting errors and found that in every month, last year’s complaint numbers beat – or often shattered – the previous year’s level.

Credit reporting complaints surged throughout 2020

The smallest month-over-month change from 2019 to 2020 was a 24% increase in February. But starting in April, numbers were up 50% or more every month, and in December, rose by a whopping 124% compared to the previous December.

Overall, 2019 saw a total of approximately 277,000 complaints about credit reporting errors, while these complaints clocked in at more than 444,000 throughout 2020, for an annual increase of more than 60%.

U.S. PIRG explains that the huge uptick in complaints is due in large part to errors in credit reporting triggered by pandemic policies that allowed consumers to skip certain payments.

See related: Will it hurt your credit score if you ask your issuer for help?

Congress’ CARES Act passed in March, the legislation that provided the first stimulus checks also instructed mortgage and student loan lenders to allow borrowers to put their payments on hold. Auto loan and credit card companies then voluntarily followed suit.

But even though the CFPB instructed lenders to report these loans and debts as “current” while consumers were in relaxed repayment schedules, many of the lenders and loan services erroneously reported the skipped payments as “late” to the three credit bureaus. Consequently, some consumers who had skipped payments with permission saw their credit scores nonetheless take a hit.

When looking at 2020s credit reporting complaints post-CARES Act, calculated from April 1 through the end of the year, the increase over 2019’s complaint numbers is 69%.

U.S. PIRG’s analysis was released March 1.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

What’s up next?

In In the News

A second credit card: When it’s wise to get one, when it’s not

Adding another credit card to your wallet can be an asset, but it’s not for everyone. Here’s everything you need to know.

See more stories
Credit Card Rate Report
Business
14.16%
Airline
15.46%
Cash Back
16.23%
Reward
15.94%
Student
16.78%

Questions or comments?

Contact us

Editorial corrections policies

Learn more