Equifax reportedly gave millions of loan seekers in the US false credit scores. The wall street journal reports that some of the discrepancies were more than enough to keep some consumers from getting approval for loans.
Equifax Reportedly Gave Millions of Loan Seekers in the US False Credit Scores
Credit monitoring company Equifax, recorded inaccurate credit scores for tons of its US consumers and then sent them to lenders between mid-March and early April, The Wall Street Journal on Tuesday reported.
Equifax erroneously decreased or increased the credit scores by over 20 points in some instances, the report claims, thus affecting the interest rates lenders offered to loan seekers and at most times prompting them to deny loan applications.
The Reason for the Issue
The company said that the error was due to a coding issue and has since been fixed. “Our data shows that less than 300,000 consumers experienced a score shift of 25 points or more,” Equifax in a statement said. “While the score may have shifted, a score shift does not necessarily mean that a consumer’s credit decision was negatively impacted. We are collaborating with our customers to determine the actual impact to consumers.”
Lenders are now seeking for more information from Equifax and are also considering various solutions for affected loan seekers who were assigned artificially high interest rates or rejected for loans, as per the Journal.
The Consumer Financial Protection Bureau’s Reaction to the Report
The Consumer Financial Protection Bureau back in January said that Equifax, along with TransUnion and Experian, had showed a pattern of inadequately responding when consumers complained of errors on their credit reports. The Consumer Data Industry Association, which is a representative of the credit bureaus, reportedly said at the time that “getting credit reports right are paramount.” The organization also added that it would work with the CFPB to protect consumers, as per The Washington Post.