Have you ever requested your credit score from a credit bureau? If so, you need to read this.
In 2017 the Consumer Financial Protection Bureau ordered Equifax and TransUnion to pay millions in fines and penalties. Both national credit bureaus misstated the usefulness and value of the credit scores they sold to consumers. The credit bureaus gave customers a score meant for educational purposes while implying it was the score reviewed by lenders.
Also, they deceived customers into enrolling in subscription programs with recurring fees. In order to get their free score, consumers were enrolled in a monthly subscription program. If they didn’t cancel within the trial period they were charged $16 or more each month.
You can read the story here.
It’s upsetting to hear how consumers were mistreated. No one should experience disinformation while trying to access something as important as a credit score and a credit report.
Implying that the data is the same as those considered by a lender can lead to big disappointment and perhaps embarrassment for a consumer. A potential borrower could be turned down for a loan unexpectedly. An apartment hunter could limit their search for housing because they mistakenly think their score is too low to qualify for a lease.
As for the subscription service, many consumers were unaware they had subscribed until they noticed the charges on their credit cards. Also, the contact information to cancel the subscription was difficult to find, and customers regularly reported poor customer service when they tried to cancel.
Thankfully, both credit bureaus have agreed to change their practices and pay $5.5 million in fines. They also were ordered to return more than $17.6 million to consumers. Affected consumers received notification letters.
As a Hanscom FCU member, you have access to your credit information through us, and it’s totally free. There’s no enrollment process, just a simple request form.
A Credit Score Review provides your credit score and report, plus a consultation over the phone or at any branch. The information you'll get will be the same criteria we would use to evaluate a loan for you. That is, the credit score we give you is the same credit score we'd use in our loan decision.†
Best of all, when you improve your score and qualify for a lower rate, we’ll adjust your current loans with us. You’ll save money by reducing finance charges. Plus, you’ll have a stronger financial profile when you lease an apartment, get insurance, or apply for a job.
Let us leave you with a request. Before accepting any service or product involving your finances, please contact us. We will help you make the smartest choice in any financial situation. As a member-owned financial cooperative, our only goal is our members' financial health.
†Note that Hanscom FCU's Credit Score and Report Review requires a hard pull on your credit, which will temporarily reduce your credit score.
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