Complaints about inaccurate credit reports are soaring

Americans are on pace to set a record this year for the most complaints about credit report inaccuracies filed with the Consumer Financial Protection Bureau, according to Consumer Reports. 

Credit score concerns accounted for slightly more than half of all complaints sent to the federal agency in 2020 and 2021, the nonprofit consumer advocacy group found. But during the first half of this year, that number has ballooned to three-quarters of all complaints.

"Mistakes on credit reports are all too common and can have serious consequences, especially for those who are already struggling to make ends meet," Consumer Reports policy analyst Syed Ejaz said in a statement. "No one should have to pay to access their own financial information."

Consumer Reports urged the three major credit bureaus — Equifax, Experian and TransUnion — to take action to ensure that people's credit reports are accurate. One way to accomplish this, it said, is to stop making consumers pay for their report. Equifax and TransUnion charge between $20 and $30 a month for unlimited access to personal credit reports. Experian's reports are free.

Under the Fair and Accurate Credit Transactions Act, consumers can get a free, complete credit report once a year at the site annualcreditreport.com. Experian and TransUnion charge consumers for repeated access to their reports.

Free access

Seeing your credit report once a year isn't enough, Ejaz said in a letter to the credit bureaus. Consumers need constant and free access to their report so they can quickly spot and dispute errors, he argued. "[C]onsumers should be able to access their credit reports securely and for free at any time, as frequently as they deem necessary," Ejaz said.

Companies use credit scores for employment decisions, while landlords use them to assess new tenants, and insurance companies use them to set prices. So a person's financial history shouldn't be locked behind a paywall, Ejaz said. 

The push for unlimited free access to credit reports comes a few months after Equifax accidentally sent the wrong credit score out for hundreds of thousands of Americans. Equifax now faces a class-action lawsuit over the credit scores, which were sent out between March 17 and April 6. Federal lawmakers also have called on Equifax to explain what caused the error and how consumers will be compensated for the mistake. 

 Aside from free reports, said Ejaz in the letter, credit bureaus can also improve accuracy by:

• Double-checking a consumer's full name, date of birth and full Social Security number before placing a mark on someone's credit report;
• Letting a consumer dispute the investigation findings of a previously submitted inaccuracy dispute;
• Mot locking a consumer out of their credit report if the person cannot answer identity questions.

Consumer Reports has launched an online petition further urging the credit bureaus to make their reports free always. 

Inaccurate credit reports have become a growing national problem in recent years, with many consumers reporting difficulty inn getting Equifax, Experian or TransUnion to delete mistakes from their file. 

An analysis from the CFPB found that the three credit bureaus collectively resolved less than 2% of credit report complaints they received in 2021, down sharply from 25% in 2019.  The number of complaints Americans sent to the CFPB about inaccurate credit reports more than doubled between 2018 and 2021, Consumer Reports said.