Credit Reporting Firms’ Changes are Boosting Credit Scores

  Attorneys general in various states sued the Big 3 credit reporting agencies beginning in 2015 alleging their reports included misleading information. The lawsuits were settled and the agencies agreed that they would not report a collection account when it was the only one on a person's report. They also agreed to remove non-loan items that had been sent to collection firms such as gym memberships, library fines, and traffic tickets. They also agreed they would not report medical debt that had been paid by insurance. Beginning in 2017, the Big 3 began removing tax-lien and civil-judgment data. Earlier this...

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Gaming the System to get a Perfect Credit Score

Bloomberg  reports that some consumers try to game the system to get a perfect 850 FICO score. Even if you are not trying for the perfect score, Bloomberg's report has valuable tips on how to improve one's score besides the obvious tactic of paying all your bills on time.

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Experian Deceived Consumers, Fined $3 Million

Today, the Consumer Financial Protection Bureau fined Experian $3 million for deceiving consumers in marketing it own credit scores. Experian is one of the credit reporting agencies that created its own credit scoring, sometimes known as fako scores. They are fake because lenders do not use them in deciding whether to give consumers credit. Creditors generally rely on FICO scores, not the agencies' own scores. The CFPB said that from 2012 through 2014 Experian falsely claimed the credit scores it sold to consumers were used by lenders. The CFPB ordered Experian to truthfully represent how its credit scores are used...

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Big Three CRAs Will Remove Many Tax Liens & Judgments from Credit Reports

Acting through their trade association, Experian, Equifax and TransUnion announced they will remove many tax liens and civil judgments from credit reports starting July 1, 2017. This will improve credit scores of millions of people. The data will disappear if it does not include a complete list of at least three data points: a person’s name, address and either a social security number or date of birth. Many liens and most judgments don’t include all three or four. This change will apply to new tax-lien and judgments added to credit reports as well as existing data on the reports. In addition, if public...

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New Credit Score Models May Help Consumers with Little Credit History

The NY Times Money Adviser has a report on new credit scoring models that rely on such data as rent and cellphone payments not used in traditional score models. The idea is to help lenders find consumers who are credit-worthy who may not have established credit histories. About 45 million Americans lack traditional credit files. These consumers may have never had a credit card or they may have had financial difficulties and stopped using credit resulting in spotty credit histories.  Many lenders will not lend to people with credit scores of under 620; alternative data might improve their scores. FICO recently...

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