Credit Report Errors

A February study from the Federal Trade Commission says that 20% of Americans have errors on at least one of their three credit reports (from Experian, Transunion and Equifax ) and that 5% had mistakes that "could led to them paying more for products such as auto loans and insurance."

http://www.mainstreet.com/article/moneyinvesting/credit/debt/cfpb-lowers-boom-credit-report-furnishers?puc=yahoo&cm_ven=YAHOO&utm_source=Sept+23+email&utm_campaign=9%2F23%2F13&utm_medium=email

Here’s a snapshot of relevant points from the FTC report:

• 25% of U.S. consumers found errors on their credit reports that could crimp their credit health.
• 20% of consumers had an error on their credit report that was corrected by the credit agency after the mistake was disputed.
• 80% of consumers who filed disputes had the mistake “modified” by the credit report agency.
• 5% of consumers had a maximum score change of more than 25 points, and only one in 250 consumers had a maximum score change of more than 100 points.

Credit reports are free through annualcreditreport.com, FTC officials note — and contact the credit bureau right away to fix a mistake. That’s especially important before buying a home, car or applying for a credit card or insurance policy.

Check Your Credit Report After Bankruptcy

A Creditor May Continue to Report a Debt

The most common way in which credit reporting errors are discovered is at the most importune time, a new credit application rejection. Old debt discharged in bankruptcy may still be reported as delinquent when the debts should have been removed or a settled debt is still listed as owed to the creditor.

The Inaccurate Reporting Maybe the Result of Credit Reporting Agency Negligence
While the Fair Credit Reporting Act was designed to protect consumers from faulty credit reporting there are often allegations of negligence against the three main credit-reporting agencies. You will need to send demand letters to each agency to clear up the errors.  If they refuse a suit may be necessary.

The Bottom Line, Check your Credit Report After Bankruptcy or Debt Settlement
Do not wait until you hear from a lender that there is a problem with your credit report. While experienced counsel can resolve these issues, the time for resolution may be outside the time constraints of a real estate purchase or new car loan application.

Credit History Pitfalls

In a recent decision, the 3rd U.S. Circuit Court of Appeals held that the Bankruptcy Code's anti-discrimination provisions applicable to private employers do not apply to hiring decisions. See Rea v. Federated Investors, No. 10-1440, 2010 WL 5094250 (3d Cir. Dec. 15, 2010). Finding that the language of the statute is plain and that Congress chose to prohibit discrimination in hiring in the anti-discrimination section of the Bankruptcy Code applicable to public employers but not in the section applicable to private employers, the court held that Federated Investors did not violate 11 U.S.C. §525(b) when it refused to hire the plaintiff because he had previously declared bankruptcy. While this decision indicates that private employers may avoid liability under the Bankruptcy Code when making hiring decisions on the basis of an applicant's bankruptcy filing, such employers will face liability under the Bankruptcy Code's anti-discrimination provisions if they terminate an employee or otherwise discriminate against an employee on the basis of his bankruptcy filing.

However, employers may run afoul of various state and federal statutes when making employment decisions, including hiring decisions, based on employees' and applicants' credit histories. The Equal Employment Opportunity Commission contends that an employer violates Title VII of the Civil Rights Act of 1964 if it makes employment decisions on the basis of individuals' credit histories, as doing so has an adverse impact on various minority groups according to the EEOC.  See EEOC v. Freeman, No. 8:09-cv-02573-RWT (S.D. Md., complaint filed Sept. 30, 2009).

Employers may also run afoul of the federal Fair Credit Reporting Act if they use a third-party consumer reporting agency to conduct background checks, which typically include credit history information, and an adverse employment decision is made based on such information, unless the employer complies with the FCRA's strict notice, authorization and disclosure requirements prior to taking adverse employment action based on such information. See 15 U.S.C. §1681 et. seq. Some states have laws which contain similar or more stringent protections.

Fed, FTC Call for Lenders to Share Credit Scores

Free credit scores could be easier to obtain under a rule U.S. federal regulators proposed yesterday, the Wall Street Journal reported today. Starting in July, lenders would be required to disclose credit scores to consumers when the scores are used to set certain credit terms. The Federal Reserve and Federal Trade Commission proposed the rules to comply with a provision included in the sweeping Dodd-Frank financial overhaul Congress passed last summer. Under the proposal, a lender would be required to provide free credit scores to borrowers when the lender uses a credit report to set high interest rates or other loan terms that are not the best available. Lenders would also need to provide credit scores when they deny credit, change the terms of an existing credit arrangement or refuse to grant credit in the amount or on the terms requested.
http://online.wsj.com/article/SB10001424052748703559604576175020502205458.html?mod=WSJ_hps_sections_personalfinance#printMode

Free Reports

https://www.annualcreditreport.com/cra/index.jsp