October 1 2010 by Ellen Roseman
Should be easy, right? You tell the credit bureau about a mistake on your birth date or the spelling of your first name, causing you to be turned down for a loan. Then, you wait to get things cleared up.
Not so fast. Some people go through exquisite torture trying to get minor correctons on their credit reports.
Take Alison, who was turned down for a new CIBC credit card. The reason? She said her birth date was Oct. 18, but her Equifax credit check showed it as Oct. 16.
Here’s how her husband describes their attempts to make things right.
Alison was unable to reach anyone by telephone at Equifaxâ€™s general number, so ordered a copy of the credit file by telephone on June 30th. She then attempted to resolve the issue online, but was told that the error could not simply be updated by Equifax. She needed to discuss it with the Dispute department.
After receiving the credit report on July 8, she made the call as requested. Unfortunately, the computerized system was not working and it did not recognize her inquiry number.
She made a number of futile attempts to speak to a human being before trying to call yet another number in the credit report, for National Consumer Relations, and spoke to a customer service representative.
She was told that the birth date shown on the Equifaxâ€™s computerized records was now Oct. 18, the correct date. But she was refused when she asked for a copy of the computerized record,.
Alison had three options â€“ she could wait 14 days and reapply online for a new copy, pay an additional charge to get it right away, or travel to the Toronto office and obtain a copy personally.
None of those options was acceptable. She was not going to spend one more minute of time on this matter without compensation from Equifax.
Not only had Equifaxâ€™s error interfered with her credit, but it had caused her to spend more than five hours trying to fix an error that she had no part in creating.
Equifax called to apologize and promise to send a corrected report once I forwarded the complaint.
Meanwhile, Alison has been thinking about why the system works badly for borrowers.
The easy answer is that the front line staff is incompetent and the computer system stinks.
However, I think that the root of the problem is that Equifax has enormous power over debtors because of the reliance that lenders place on the credit reports, but debtors have absolutely no power over Equifax.
Equifax knows this. It is easier and cheaper for them to deal with disgruntled debtors on a case to case basis, as here, than it is to design appropriate systems and train appropriate staff.
The banks and creditors, who pay Equifax for the credit information, have some control because they can choose to use one reporting agency over another and so their opinions matter to Equifax. Hence the policies are designed to keep them happy.
The debtors, on the other hand, can’t pull their business from Equifax; they can’t refuse to deal with Equifax. Debtors have no leverage with which to make Equifax behave.
They can’t refuse to undergo credit checks. They have no choice in how their information is gathered; they have no choice in how the information is used; they have no choice in the procedures that are imposed on them.
The legislation governing credit agencies is inadequate and does not recognize commercial realities and enormous imbalance of power between the agencies and the debtor.
Now let’s look at a story about TransUnion and a man named Rajesh, who also applied for a credit card.
I was encouraged to apply for a Walmart Mastercard, but my request was declined. I feel I should have a strong credit rating, but Walmart said there was a problem asked me to call TransUnion.
The representative said my first name has been incorrectly spelled as RJESH instead of RAJESH. He said I should send them a letter, asking to correct the name.
I both faxed and mailed a letter, with copies of my driver’s license and credit card. However, it’s been four months. They sent me a letter asking for the documents again and have not corrected the error.
The TransUnion rep also mentioned a problem with Honda Finance and end-of-lease charges. I succeeded in getting Honda to waive the charges, but they went on my credit record anyway.
During this time, two other credit card companies wrote to me, saying they had significantly reduced my credit limit since they felt I was a high risk customer.
It’s very tiresome to talk to TransUnion. Every time, they ask me a lot of questions and ask me to send a lot of documents. They don’t acknowledge any receipt of documents, as the phone reps seem to have no way of knowing if my faxed or mailed documents have reached them or not.
Here’s a final TransUnion story, involving an incorrect birth date for Paul’s wife.
My wife and I tried to open a joint account with Ally Bank. and sent in all the paperwork (birth certificate, passport, S.I.N etc.). Ally called and said no, my wife’s birthday was incorrect, according to TransUnion’s credit report.
We tried to get an online credit report from TransUnion, but the birth date was wrong and this was one of the items you needed for online access. So we sent in the paperwork for a free credit report, including a copy of my wife’s birth certificate.
They sent back the credit report with the wrong birth date. So much for checking to make sure they were sending out the right report.
I called them and suggested they review the info on file and correct the date, as we had sent in the birth certificate.
Nope, they couldn’t talk to us as we did not have the correct info to access the file. The birth date was wrong.
It took two months to sort this out and we resubmitted all the info.
You are right we need some legislation to make these companies correct wrong information and not force the consumer to jump through hoops.
We found out the date was right with Equifax, but nobody compares the data.
In my column last week, I suggested penalizing credit granters and credit bureaus that pass along incorrect information. Are the politicians listening? I’m sure they could gather many stories like these if only they started listening.