Earlier this year, the three major credit bureaus (aka “credit reporting agencies” or “CRAs”), Experian, Equifax and Transunion, came to a settlement with the New York Attorney General impacting credit reporting. It is anticipated that the settlement will help some consumers improve their scores by 10-40 points.
Here are some of the upcoming changes that will be taking place later this year.
- Credit bureaus will have to actually verify that the consumers information (name, address, birth date, social security number, etc.) before being able to report public records, such as judgments or tax liens.
- Medical debts will no longer be able to be reported until 180 days have passed. This will allow more time for consumers to work with insurance companies before they’re reported on their credit.
- Debts that are not from an agreement or contract, such as traffic tickets or government fines are not allowed to be reported.
- Disputing errors should actually be more meaningful with an improved process handling disputes and credit fraud.
- An additional free credit report (www.annualcreditreport.com) will be available should a consumer file a dispute. Currently consumers are allowed 1 free credit report from each credit bureau.
A 10-40 point difference in your credit score may not sound like much…but it can make a difference for some who are trying to qualify for a mortgage payment and improve the pricing of mortgage rates.
If you’re considering buying or refinancing a home, I recommend starting with a review of your credit now. If you do need to wait for the new procedures to come into play, you’ll have time to make other improvements to your credit while you wait. I’m happy to help you with your mortgage needs for homes located anywhere in Washington state.
Please leave a reply