Equifax admitted this week that it misreportedpotentially affecting mortgage, car loan, or credit card applications.
The Wall Street Journal reported Tuesday that between March 17 and April 6, the company sent consumers millions of incorrect credit scores. After Equifax He said Less than 300,000 customers changed their credit scores by 25 points or more in either direction. The company said errors in how different items in the credit report were weighted led to volatility.
A Florida woman who was forced to take out an expensive car loan as a result of an incorrect finding from Equifax is now suing the company. The lawsuit, which seeks the status of a class action, notes that during the three-week period, Equifax submitted false scores, and 25 million credit reports were withdrawn from the three credit reporting bureaus. The lawsuit claims that given these numbers, millions of Americans could have been affected by the error.
Although Equifax said basic information has not changed, a 25-point credit score change can make the difference between approving or rejecting financial products as well as impacting the amount of interest you pay.
Read on to find out if the errors affect you and what you can do if your credit score is affected.
Did you apply for a loan or credit this spring?
Unless you applied for a loan, credit card, or other financial product between March 17 and April 6, it’s hard to know if you’ve been affected by Equifax’s registry errors.
“If you haven’t monitored your credit score and your credit report regularly, how do you know?” Bruce McClary, Senior Vice President of Membership and Communications at National Credit Counseling, said:
However, “if you go to a lender and get rejected… this could be evidence that you may be a victim,” he said.
What did the lender say?
If you are refused a loan, or if you receive worse financial terms because you are considered a credit risk, the lender is wanted To send you a notice explaining the decision.
McClary advises going back to the rejection notice to see what factors are involved. If you can’t find it, contact the lender and ask if they can take it off their registry.
“You want to be absolutely sure why the lender will reject your application,” he said.
“It is not right to assume that it will always be the credit score,” McClary added. “Maybe the debt-to-income ratio wasn’t what they wanted. Maybe your job history didn’t reflect the kind of stability they were looking for.”
There are two types of notices that lenders send when they deny credit, according to the Federal Trade Commission. If you are denied based on information in the consumer report, the lender must file a Notice of Adverse Action. If you receive less generous terms, the lender must send a “risk-based pricing” notice.
If you apply for a credit card or loan and don’t receive any of the notifications, you won’t be negatively affected by the Equifax error, according to NerdWallet.
Check your credit report
The next step is to request your credit report. Consumers are entitled to a free credit report periodically, which they can request at yearcreditreport.com. If there is something wrong with the report, dispute it. You can also try calling the Equifax support line at 1-888-378-4329.
Once you have corrected any issues on your credit report, “it’s worth going back and asking for a reconsideration. That means applying for the loan again,” McClary said.
McClary noted that the current situation is unusual. Unlike financial institutions that have experienced data breaches, Equifax has not reached out to customers to alert them about the issue.
The credit bureau did not respond to questions from CBS MoneyWatch about whether it plans to contact customers.
Some lawmakers are now pushing the company to point out the error and compensate for any error.