Starting July 1, credit reports just got a lot more accurate

Starting July 1, credit reports just got a lot more accurate
Eileen St. Pierre, The Everyday Financial Planner

On July 1, the three credit reporting agencies (Experian, Equifax, and Transunion) started to tighten data reporting requirements for those consumers with civil judgments and tax liens against them. Now these agencies are requiring debt-eraserthe following for these records to be placed on your credit report:

  • A Social Security number or date of birth to go with your address.
  • Records need to be updated every 90 days.

Records that do not meet these new standards will be removed from your credit report.

Why is this happening?

These agencies haven’t been required to do this. They are doing it voluntarily. They just got sick of so many people complaining about these incomplete records hurting their credit scores. These types of records hurt your credit score a whole lot more than carrying a balance on your Visa card.

Who is affected?

Only about 6 or 7% of people with FICO scores will probably be affected – and only by a little bit. It is predicted these people should see their FICO scores rise only by about 10 points. The reason – people who have these types of records on their credit reports typically have other negative information such as collections and past due payments.

What can you do?

If you haven’t done so in a while, check your credit report. You can get a free copy from each of the three credit reporting agencies at www.annualcreditreport.com every 12 months. Check it for any reporting errors. Follow the instructions on the report on how to get them removed, or check out my blog post. Don’t count on errors to be removed for you. You are responsible for your own credit history.

For more help on managing your credit, visit my Debt Management page.