The information on a consumer’s credit report carries more importance and weight than most people take for granted, because whatever it is listed on the report would be used to affect the credit user’s financial situation. That is why legislators have added a new measure into the Financial Reform Bill to reduce errors on credit reports and further benefit their consumers.
Michael Barr, Treasury Assistant Secretary, wrote a While House blog that revealed that consumers have filed an estimated 150, 000 complaints about finding false information on their credit reports over the past few years. Barr pointed out that there are also an additional estimated 6 million Americans who found mistakes and errors on their credit reports that are enough to deny them credit.
Credit reports are more than just a simply rundown of a consumer’s payment history, accounts, balance, and payment behaviour in each category. This financial document would be used to determine how credit worthy the consumer is and if that credit user would be able to have a loan, acquire a job, get a promotion, purchase insurance, and even rent living space. This is why there was a need to make sure that credit reports be accurate and mistake-free as much as possible.
The Dodd-Frank bill would make sure that these problems would be solved and mistakes would be minimized by putting forth a measure that would give the Consumer Financial Protection Bureau (CFCB) the right and authority to regularly examine major credit bureaus. These examinations would gauge the credit bureaus’ compliance with the federal financial law, as well as the Fair Credit Reporting Act. The CFCB would also conduct several studies that would make sure that these creditors and their credit score variation would not put them at a disadvantage or negatively affect their competition.
This initiative would allow credit users who have been turned down from a job or denied a loan before because of their credit information to view their credit score without being charged. Unlike a credit report which is shown to consumers once every twelve months for free, credit scores could only be reviewed if the consumer pays a few more extra dollars for it.
Meanwhile, consumers are advised to make a household budget most especially if they find their credit is in trouble and that they have difficulty in paying their bills. This would give the consumer a clear idea on how much they are spending, and would even help them in thinking up ways to save more of their money. By following a budget and paying down their debts, consumers and credit users would find that their credit score and credit report data would improve. And with that, these consumers would have a better financial situation.
