There are big changes to the way creditors report to credit reporting agencies. Changes that you will want to be aware of.
In 2015, Equifax, Experian and TransUnion announced the National Consumer Assistance Plan to enhance their ability to collect complete and accurate consumer information and provide consumers more transparency when interacting with consumer reporting agencies about their credit reports. The plan was announced after cooperative discussions and an agreement with the Attorneys General of multiple states.
In 2016 the three major Credit Reporting Agencies (CRA’s) stopped allowing the reporting of debt that did not arise from a consumer contract or agreement to pay. This included, but was not limited to; certain fines, tickets, and other assessments. Examples included library fees or fines, parking tickets, speeding tickets, and court fees or fines.
In July of this year the bureaus began to exclude and delete currently reported tax liens and civil debts if reports on those obligations don’t include a consumers’ names and addresses, as well as Social Security numbers and/or date of births. The Consumer Data Industry Association (CDIA) indicates that many liens and most judgments don’t include all of this data, in part because Social Security numbers are often redacted for security reasons.
Starting September 15, 2017 there are more changes coming. The three major credit reporting agencies will set a 180-day waiting period before including medical debt on a consumer’s credit report. The six-month period is intended to ensure there’s enough time to resolve disputes with insurers and delays in payment. In addition, the credit bureaus will remove medical debt from consumers’ credit reports once it’s paid or being paid by an insurer.
Another, very relevant change on September 15th, is the requirement of a full Social Security Number or Full Date of Birth on all debts reported. We recently received communications, again from TransUnion, that either full Social Security Number or Full Date of Birth will be required after the Sept. 15th date. If you are a creditor that does not collect one of these pieces of data, you will want to adjust your policies to allow for reporting after this date.