Some changes took effect at the top of this month that could have amazing results on your credit score!
We’ve talked about the importance of your credit score in some of our recent posts. Your credit score—more importantly your FICO credit score (which is a combination of your credit scores and credit history)—is assessed to determine your eligibility for lines of credit, personal loans, auto loans, and more importantly, home loans. The higher your FICO score is when you apply for a mortgage, the better your chances are at negotiating mortgage loan terms with your bank or broker.
In a recent review of the three main credit bureaus, Equifax, Experian, and TransUnion, the Consumer Financial Protection Bureau found a number of concerns within the credit reporting processes of the agencies. The main issues that were called to attention included improper quality control procedures as well as incomplete and inadequate investigations when handling disputed accounts from consumers.
Raising your credit score can be challenging. Collections, debts, and student loans often tend to sneak up on us when we least expect it. One late credit card payment could drop your score down 90 or more points, and once your score is down (or damaged) it takes time to repair it again. Because of the difficulty of maintaining good credit, it’s important that the information on your credit report is accurate. Otherwise you could be receiving penalties and dropped points on someone else’s behalf. For far too long consumer credit reports have been erroneous due to insufficient identity information. As a part of the new standards set for the credit bureaus, the government has outlined a list of ways for the credit bureaus to improve on accuracy of information before applying a collection to someone’s credit report. Beginning July 1, 2017 a new and improved list of standards was set for credit bureaus.
Equifax, Experian, and Transunion are due to pay more than $17 million in restitution back to consumers who’ve been victims of false reports. They are also due to pay at least $5 million in fines and penalties to the Federal Government. 12 to 20 million Americans are expected to benefit from the new standards put in place by the Consumer Financial Protection Bureau. Those who will the see the change are most likely consumers who had civil debts and tax liens on their credit report.
Your credit score updates every month. Be sure to be on the lookout for a rise in your score!
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