Credit Scores Perpetuate Past Discrimination

Credit Scores Perpetuate Past Discrimination A report by the National Consumer Law Center entitled Past Imperfect: How Credit Scores and Other Analytics “Bake In” and Perpetuate Past Discrimination shows how past discrimination perpetuates low credit scores. Credit reporting and credit scoring are supposed to be objective, with no room for flawed tools such as human judgment and biases. Yet for years, study after study has found that African-American and Latino communities have lower credit scores as a group than whites and Asians. The report discusses how credit scores perpetuate racial and economic inequality. Eliminating the impacts of past discrimination may...

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Better Alternatives to Buying Credit Monitoring

Better Alternatives to Buying Credit Monitoring The credit agencies are eager to sell you credit monitoring at about $20/month. Here are reasons not to buy it. It doesn’t prevent ID theft, it only tells you after the theft has been committed – the proverbial shutting the barn door after the horse has run away. If you are really threatened with identity theft, you can put a security freeze on your credit files that actually prevents the ID theft by locking out access from the credit reports. Credit monitoring is not a good value proposition. You can check your credit report...

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American Banker asks if Credit Bureaus Can Finally be Tamed

American Banker asks if Credit Bureaus Can Finally be Tamed 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...

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Medical Debt Wreaks Havoc on Consumers’ Credit Reports

Medical Debt Wreaks Havoc on Consumers’ Credit Reports The Consumer Financial Protection Bureau (CFPB) released a report that reveals that over 1 in 5 consumers, or 43 million, have black marks on their credit reports for medical debts, and that medical debts constitute over half of debt collection items on credit reports. Chi Chi Wu of the National Consumer Law Center said “This report is another example of the powerful information revealed by CFPB’s groundbreaking research.” Medical debt is different from other types of consumer debt. Medical debt is unique because the most vulnerable patients – the uninsured and underinsured...

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