One Out of Five Consumers Has Errors on Their Credit Report

FTC: One Out of Five Consumers Has Errors on Their Credit Report
Excerpt:

For years, Americans have been told that our credit score is the most important number in our financial lives. A good or bad credit score can determine not only whether or not you can get a loan but also whether you can get a job – or even a date.

But a new study by the Federal Trade Commission (FTC) finds that 20% of consumers have errors on their credit reports and 5% of consumers found errors that might affect their credit scores.

“These are eye-opening numbers for American consumers,” Howard Shelanski, director of the FTC’s Bureau of Economics, said in a statement. “The results of this first-of-its-kind study make it clear that consumers should check their credit reports regularly. If they don’t, they are potentially putting their pocketbooks at risk.”

A 60 Minutes story on the FTC report Sunday night seemingly called into question the integrity of the credit reporting industry and suggested industry leaders Equifax, Experian and TransUnion make it extremely difficult to get errors fixed.

But the Congressionally-mandated report also revealed that 20% of consumers had an error that was corrected by a credit reporting agency and 80% of consumers who filed disputes experienced "some modification" to their credit report.

“I think for the most part, for most people [the credit scoring system] works,” says Gerri Detweiler, director of consumer education at Credit.com. “The vast majority of mistakes are pretty easy to fix” and the industry is generally responsive.

Comment: Image capture from zoomcreditscore.com. We use MyFico quarterly credit monitoring. Why one's credit score is important: It impacts the cost of borrowing (say a mortgage or auto loan).