Wednesday, April 29, 2015

Reforming how credit reporting agencies do business

Here at Shenwick & Associates, many clients seeking our help with bankruptcy and debt relief have credit issues. Although many of these issues may be related to nonpayment or late payment of bills, at least part of the blame lies with the credit reporting agencies (Equifax, Experian and TransUnion), whose negligent reporting practices in reporting have led to many consumers receiving credit reports that are riddled with errors. In addition to our bankruptcy practice, we also offer credit repair services.

Last month, New York State Attorney General Eric Schneiderman announced a settlement after a three year investigation of the credit reporting agencies that would represent a radical change in the way they do business. Provisions of the settlement include:

  • Moving away from an automated credit dispute resolution process to using specially trained employees;

  • Establishing a six month waiting period before reporting medical debts on a credit report (which are often caused by delayed insurance payments or other disputes);

  • Removing medical debts from a credit report after the debt is paid by insurance; and

  • Publicizing the availability of free yearly credit reports from each agency through this website. The agencies will also have to provide a free report to consumers who experience a change in their credit reports after initiating a dispute.
The changes will be phased in over three years, but most of them will occur over the next six to 18 months. But if you’re experiencing problems with your credit report, please contact Jim Shenwick today.