CFPB Reports on Credit Disputes
Last week, the CFPB released a report entitled, Disputes on Consumer Credit Reports. The purpose of the report was to document how disputes can appear in credit record data, the characteristics of consumers whose disputes appear on their credit reports, and what happens to accounts that have been reported as being disputed.
Here at AFSA, we’re glad that the CFPB is looking at credit disputes. And we think more research is needed. The report used the CFPB’s Consumer Credit Panel (CCP) to examine the frequency and outcomes of certain disputed information on credit reports. However, it did not look at how many of disputes were submitted by credit repair organizations.
We encourage the CFPB to study how many disputes are submitted by credit repair organizations, how many of those disputes are actually valid, and the effect that frivolous and duplicative disputes have on consumers and the credit system.
As the CFPB warned consumers, “Credit repair companies often promise to improve your credit report by contacting credit reporting agencies on your behalf and challenging items on the reports. The fees these types of companies may charge are often high. You also can’t remove negative information if it’s accurate, and you might end up paying for no results.”
In 2016, the Bureau found that more than half of people who submitted complaints with the CFPB about credit repair chose the issue “fraud or scam” to describe their complaints. An in-depth study of credit repair organizations could help fulfill the Bureau’s mission to protect consumers.
November 8th, 2021
