Credit Education

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03. Aug, 2016

Why The Bureaus Suck

It’s easy to understand why tens of millions of Americans with bad credit ratings dislike credit bureaus. Financial institutions use their credit scores to measure a loan seeker’s trustworthiness. A poor credit report with a low credit score stands in the way of that badly needed loan. Firms recruiting for responsible positions often request a credit report. A look at this report might change their minds about the job offer.

Nobody welcomes bearers of bad news. The customer may accept responsibility for their sad financial state but still not care to get a reminder. This credit bureau role automatically makes them the ‘bad guys’, but some of their policies and actions really invite a serious critique. Even the majority of Americans with good credit ratings have no kind words to spare for them.

Credit Report Errors Push Down Credit Status
Complaints over credit report errors top the grievance list. Some customers discover duplicate bill entries on their credit reports. Others find entries for non-existent car loans or credit cards they don’t own. One social media writer described how her credit report shows her credit utilization at 98% when the correct percentage is 49%.

Are bungling credit bureaus really responsible for report errors? They get their source information from financial institutions. Many times, the bank or credit card company makes an error and the credit bureau picks it up. Perhaps the bureaus could do more to verify their information sources. A significant number of customers seem to hold them accountable for the damage inaccurate credit reports cause.

Difference in Credit Scores
Angry customers complain about unfairness in credit score calculations and ways credit scores vary between bureaus. For example, why should a very short credit history bring a low credit store? This often happens to young people at the start of their careers. Credit bureaus suspect anyone without a full credit history may be a risk. In English law, people are traditionally assumed innocent until proven guilty. However, credit bureaus seem to take an opposite view.

The difference in credit score calculations puzzles many customers. Why does one bureau give the customer 635 points, but the other bureau rates them at 600 points? Variations in credit history the bureaus receive explains some of these differences. The calculation methods also give different results. Nevertheless, this situation annoys customers. They want to understand how bureaus make their calculations. People with good credit histories cannot work out why they get low scores. Credit bureaus fail to provide the explanations they want.

Poor Customer Service
When customers request the credit bureaus correct a credit report error or some other complaint, they expect good customer service. Bad customer service experiences include bureau representatives asking about loans they never took out and requests to resend documents. Many customers find it hard to locate the representative they need. The credit bureaus’ automatic call handling system leads customers round in a circle.

Another common customer service issue concerns the way credit bureaus pass on complaints to the bank or business who supplied the original credit history data. This looks like a classic case of “passing the buck”. Typically, the bank writes back to the credit bureau and tells them the information they sent was correct. The bureau classes this issue as solved and takes no further action. This policy leaves customers feeling as though they have no redress for their grievances.

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