Transcript
Credit Karma Advertiser (0:02)
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Clark Howard (1:00)
I'm so glad you're with us on the Clark Howard Show. You know our mission is to serve you with advice and information that empowers you to make better financial decisions in your life. In this episode, it has become more important for you to monitor your three credit reports because the number of errors is going through the roof. I'll tell you why. The credit bureaus, at least two of them, are saying too bad, so sad and leaving errors there. And later, how often do you get a new cell phone? So I got to tell you strategies for you on when to get a new cell phone and more important, when not to. So ProPublica that does deep dive research into various things affecting you and me, did an extensive study of Equifax, Transunion and Experian and I have picked on Equifax a lot over the years and want to tell you that the research done by ProPublica found that Equifax is doing a better job. Not an outstanding job, but a better job, significantly better than the other two credit bureaus at dealing with customer complaints about inaccuracy. And the way it's referred to in their study is it shows the number of complaints per month and the number of complaints about inaccuracies on credit reports is up dramatically with all three credit bureaus over the last two years. I mean skyrocketing number of complaints filed by consumers. And then the question is how do they deal with them? So in a typical month that Equifax gets about 160,000 or so complaints from consumers who've looked at their credit files and find inaccuracies. They solve about 100,000 of those. I would say that for an industry that historically has been pitiful and how they've treated Consumers looking at us as just a bother. That's better than I would expect. You want to talk worse than you would imagine. Let's talk TransUnion. Latest data on them is they are only resolving about a third of the complaints consumers file. So TransUnion is like, who? What I saw. And that's why you've got to have an eagle eye out. And let's talk Experian. Oh, my goodness. The data on experience is beyond pathetic. Experience success, if you would call it. And dealing with complaints from consumers is. This is shocking, but it's basically near zero. Less than 1%, less than 1% of people who have a problem on their Experian credit report, contact Experian and get it taken care of. That is beyond outrageous because what that error on the credit report can do is it can lead to denial of the loan. It can lead to credit card companies deciding to close your accounts. It can cost you a job that you need. When they rely on a credit report and they're like, oh, this person's not responsible. We don't want them at our company. Insurers might deny you insurance or charge you more because of the errors. This is absolutely shocking to see this disaster that ProPublica found at Experian. So two things here. One, what do you do? First, this is a case. What you don't know can hurt you. When's the last time you looked at what the credit bureaus have on you for free@annualcreditreport.com? ignore all the stuff the bureaus try to sell you. You can see your actual reports and see if they're a. Okay. You can sign up with Credit Karma and see the information on you at two of the three bureaus whenever you want for free. And let's say you find something that's not right and you challenge it. Well, I've just given you the research that ProPublica came up with that found that Equifax got the best shot that they're going to actually pay attention to what you send them and fix it. TransUnion got about a 1 in 3 shot. And Experian, you got less than 1 in 100 shot. So what do you do? Let's say you're trying to do something in your life and they show your credit all messed up. What do you do when they ignore you when you file? Because in the past the success was much higher when the Consumer Financial Protection Bureau was actually doing its job, but now they're not. So what power do you have? You're going to Be surprised, but the most effective tool people have been able to use when they've had to is you sue the credit bureau that is putting inaccurate information about you in small claims court where for a low filing fee and you don't need a lawyer, you sue them and then what's the credit bureau going to do? Then they give you to somebody often at the credit bureau who will actually look at what you're complaining about and likely fix it. I mean, why should it have to be that way? But I'm telling you, if it's like a severe thing that's impacting your ability to get a job or keep insurance or keep your credit or get credit or be able to get a mortgage and the credit bureaus are not doing what the law requires. The law requires that they do this. You use the law yourself. Shouldn't have to be that way. Krista.
