Experian Deceived Consumers, Fined $3 Million

POSTED BY: Mark F. Anderson | Credit Score, News

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

POSTED BY: Mark F. Anderson | Credit Report, Credit Score, News

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

POSTED BY: Mark F. Anderson | Credit Score, News

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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CFPB Orders TransUnion and Equifax to Pay for Deceiving Consumers in Marketing Credit Scores

POSTED BY: Mark F. Anderson | Credit Score, News

The Consumer Financial Protection Bureau today announced it has taken action against Equifax and TransUnion for deceiving consumers about the usefulness and actual cost of credit scores they sold to consumers. The companies also lured consumers into costly recurring payments for credit-related products with false promises. The CFPB said that from 2011 to March 2014, TransUnion and Equifax falsely represented that the credit scores they marketed and provided to consumers were the same scores lenders typically use to make credit decisions. In fact, the scores were not typically used by lenders. Plus, TransUnion and Equifax falsely claimed that their credit...

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FICO on Understanding Credit Scores

POSTED BY: Mark F. Anderson | Credit Score, News

FICO on Understanding Credit Scores FICO credit scores are used by 90% of lenders. For a thorough explanation of how FICO scores are computed, go to FICO’s website, myfico.com. FICO’s booklet on the subject covers the subject, which you may download here.

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