Read part 1 by clicking here!
From January 2020 to September 2021, CFPB received more than 700,000 consumer complaints about Experian, TransUnion, and Equifax—the national credit reporting agencies (NCRAs). But the number of successfully resolved complaints dropped to just 5%. Why? According to a recent report by the Consumer Financial Protection Bureau (CFPB), one reason for that is, unfortunately, many people rely on commercial “credit repair” companies to file their complaints.
This is unfortunate because the CFPB receives thousands of complaints about these “credit repair firms,” too.
While consumers have real concerns (for example, identity theft or a mixed file), credit repair companies often file meritless complaints on their behalf. These firms frequently rely on mass-produced templates and dispute irrelevant facts. As we explained in our previous post, by law, the NCRAs don’t have to investigate frivolous complaints, so NCRA computers quickly identify and disregard these form complaints.
Problems such as these are so common that CFPB and other federal agencies are suing many “credit repair” companies for violation of federal laws. Issues with these purported credit repair companies include:
- Charging consumers illegal fees
- operating in bad faith
- misleading consumers, and
- defrauding their clients
The wrongdoing of these companies is so pervasive that the NCRAs say dealing with their bogus reports is hurting their ability to address legitimate complaints.
While it will probably take an act of Congress to repair the damage being done by duplicitous credit repair companies, individual consumers should walk away with two key insights from this report:
First, individuals have the right to dispute problems with their credit report—correcting their record and even receiving financial compensation for errors
But a cheap, quick form complaint is too easy for a credit bureau to disregard—and that includes a complaint filed by a credit repair company. All too often, these companies aren’t the experts they claim to be.
That’s why consumers struggling with problems in their credit reports should consult with an attorney. An attorney will evaluate their claim and prepare a solid complaint that the NCRAs must investigate and respond to.
If you have issues with your credit report and the credit bureaus aren’t taking action to address your complaints, that isn’t the end of it. You have recourse. But you need to file a complaint that the NCRA can’t dismiss. To do that, contact an attorney. Our firm specializes in repairing clients’ credit records and obtaining compensation for damages they have sustained. We specialize in helping clients like you.