The federal Consumer Financial Protection Bureau (CFPB) is urging the top credit card companies to make financially critical credit scores available free of charge to their customers in monthly printed statements or online accounts.
From October 2012 to February of this year, the bureau fielded nearly 31,000 complaints from consumers unhappy with their credit reports. Inaccuracies in those reports were the top complaint.
The bureau also issued a bulletin warning companies that provide credit reporting companies with information not to avoid investigating consumer complaints.
Based on information provided by thousands of providers, more than 200 million Americans have credit scores on file with three major reporting agencies; Equifax, Experian and TransUnion.
FICO, created by Fair Isaac Corporation, is the most frequently used credit score and it can determine whether an individual qualifies for mortgages and auto loans, the amount of interest charged by lenders, and in some cases, approval for a rental apartment.
Federal law allows an individual to request a free credit report annually from each of the reporting agencies by going to the website, www.annualcreditreport.com. But the CFPB found that only 1 in five people do so, even though monitoring such information is vital to uncovering incorrect information or identify theft.
According to the New York Times, at least three credit card companies – Barclaycard, First Bankcard and Discover – began providing free credit scores last year, well before the bureau’s recent request. Other companies say they may soon follow suit.
Free credit scores can bring positive results with “limited effort,” said CFPB Director Rich Cordray in a letter to credit card company executives.
FICO has taken steps to make it easier for lenders to provide free credit scores with an “open access” program, and is negotiating with several card issuers. No new charges are anticipated for this service.
Some executives, however, have said there are costs associated with marketing and training call center representatives who field customer questions.
Between July 2011 and February 2014, more than 20,000 credit reporting complaints were referred back to companies for review and response. At 73 percent, inaccurate reports were the top complaint. Other typical complaints concerned investigations done by credit reporting companies and not receiving a credit score.
In one instance, CFPB said a recent college graduate tried unsuccessfully to remove a mortgage listed on his report that was not his. After repeated requests, the company informed the graduate that he could not file any more complaints.
