The Hidden Horrors of Your Credit Report
During National Consumer Protection Week, American Consumer Credit Counseling urges consumers to examine their credit report to avoid financially dangerous errors that could drastically lower their credit score
(Boston, MA) – March 5, 2013 — As National Consumer Protection Week kicks off in March, many consumers are reminded of some of the critical mistakes that can cause long term damage to their financial profile, the most common of which is credit reporting errors. A recent study released by the Federal Trade Commission earlier this year discovered that 26 percent of consumers suffer from material errors on at least one of their three credit reports – errors which often go unnoticed. Even more shocking, 5 percent of these consumers participating in the study moved into a different credit risk tier once the error on their credit report was corrected.
“National Consumer Protection Week is a reminder for consumers to take the time to educate themselves to avoid falling victim to credit reporting errors,” said Steve Trumble, president and CEO of national nonprofit American Consumer Credit Counseling. “A credit report can impact consumers’ ability to borrow, get a job, afford a home, and even get an education. This report indicates that consumers should not only be reviewing their credit report twice each year, but also should expect to find at least one reporting error and know how to dispute it.”
Of the 1,001 consumers surveyed by the FTC, 1 out of 10 people found significant mistakes on their credit report that lowered their credit score. Such errors included the number of credit-card or mortgage payments a consumer was believed to have missed or the number of loans that were sent to collection agencies. Additionally, the 8-year long survey found that about 8 million people file a dispute about their credit report each year, many of which go unanswered.
“For many consumers, a ten point error in your credit score can mean thousands more in interest from increased rates,” continued Trumble. “But the trouble that many consumers have is getting the issue resolved once it’s been identified, often being trapped in a legal battle for years to dispute a claim or substantiate their identity.”
As more and more consumers transition to online banking and purchases the risk for having personal information such as name, Social Security number or credit card information stolen has increased. According to a Javelin Strategy & Research’s 2012 Identity Theft Report, last year alone, there was a new victim of identity fraud once every three seconds with more than 12 million consumers losing more than $21 billion over the course of the year, as thieves open new credit card accounts in the victims’ names.
“Identity theft and credit errors go hand in hand when it comes to educating yourself,” said Trumble. “I cannot stress enough how important it is for consumers to be able to obtain and read a credit report and how important it is to save important documents such as bank and credit card statements. Often this can mean the difference between years of stress and thousands of dollars spent on reclaiming your identity.”
ACCC’s Financial Fitness Center offers consumers critical information to help them understand their rights under the Fair Credit Reporting Act, how to obtain and read a credit report and how to file a dispute. In addition, ACCC joined forces with the Federal Trade Commission as part of the agency’s national campaign, Fighting Back Against Identity Theft.
ACCC is a 501(c)3 organization, that provides free credit counseling, bankruptcy counseling, and housing counseling to consumers nationwide in need of financial literacy education and money management. For more information, contact ACCC:
- For credit counseling, call 800-769-3571
- For bankruptcy counseling. call 866-826-6924
- For housing counseling, call 866-826-7180
- For more information on financial education workshops in New England, call 800-769-3571 x1908
- Or visit us online at ConsumerCredit.com
About American Consumer Credit Counseling
American Consumer Credit Counseling (ACCC) is a non-profit 501(c)(3) organization dedicated to empowering consumers to achieve financial health through education, counseling, and debt management. ACCC provides individuals with practical solutions for solving financial problems and recognizes that consumers’ financial difficulties are often not the result of poor spending habits, but more frequently from extenuating circumstances beyond their control. As one of the nation’s leading providers of financial education and credit counseling services, ACCC works with consumers to help them with the best plan of action to reduce their debt and regain financial stability. ACCC is accredited by the Better Business Bureau and holds an A+ rating. It is also a member of the Association of Independent Consumer Credit Counseling Agencies. For more information or to access free financial education resources log on to ConsumerCredit.com or visit TalkingCentsBlog.com.