New Report: 1 in 10 Consumers Have Incorrect Credit Score

FTC Finds High Number of errors in credit reports

By Sean Coffey, Program Manager, Foreclosure Help

The Federal Trade Commission released a report today (focused on credit report errors at the three large credit reporting agencies (Experian, Equifax, and Transunion) and found significant mistakes, with one in ten consumers reporting a change in their credit score AFTER they contacted the agency to dispute inaccurate information.

Regular readers of our blog may recall that the Consumer Financial Protection Bureau also released a report  (Analysis of Differences between Consumer- and Creditor-Purchased Credit Scores) with a similar focus in September 2012, which found that one in five consumers would see a different score than their lenders.   See our blog on the topic here: “1 in 5 consumers receive a different credit score than their lender”

In the most recent report by the Federal Trade Commission, (Report to Congress
Under Section 319 of the Fair and Accurate Credit Transactions Act of 2003) the researchers found:

  • 25% of consumers identified errors on their credit reports, potentially affecting their credit scores;
  • 20% of consumers had their errors corrected by at least one of the agencies after the consumer disputed it;
  • About 1 out of 20 consumers saw their credit score change more than 25 points, while 1 in 250 customers saw a credit score change of more than 100 points.

We’re glad to see that the Consumer Financial Protection Bureau is now overseeing credit reporting agencies.  The consumers who were interviewed last night on 60 Minutes (40 Million Mistakes: Is your credit report accurate?) had some pretty harrowing tales about trying to correct their credit reports, with some choosing to hire attorneys because the process was so slow/unsuccessful when they attempted to contact the credit reporting agencies.

You may find our previous blog postings helpful:

If you are struggling with foreclosure in San Jose or Sunnyvale, please give us a call. The sooner you pick up the phone, the sooner we can help, and the earlier you start in the process, the more options you will have to create a plan forward.

If you are a homeowner living in San Jose or Sunnyvale and are struggling with your mortgage, please contact ForeclosureHelpSCC, a program funded by the City of San Jose and the City of Sunnyvale at (408)-293-6000 or visit our website: www.foreclosurehelpscc.org.

Our HUD-approved counselors can help you evaluate your options, learn more about federal and state programs that may help you with your mortgage issues, and will help you create a plan forward.

Please note: All content included in the ForeclosureHelpSCC blog is provided for information only and should NOT be considered legal or tax advice. If you have any questions, please feel free to contact us on our hotline: (408)-293-6000, or visit our website: www.foreclosurehelpscc.org or send us an email: help@foreclosurehelpscc.org.

Si usted es dueño de una casa en San José o en Sunnyvale y están luchando con su hipoteca, por favor póngase en contacto con ForeclosureHelpSCC, un programa financiado por la ciudad de San José y la ciudad de Sunnyvale, al (408) -293- 6000, o visite nuestro sitio: www.foreclosurehelpscc.org.

Nuestros consejeros aprobados por HUD puede ayudarle a evaluar sus opciones, aprender más acerca de los programas federales y estatales que pueden ayudarle con sus problemas de hipoteca, y le ayudará a crear un plan para seguir.

Por favor, tenga en cuenta: Todos los contenidos incluidos en el blog ForeclosureHelpSCC se proporciona únicamente a título informativo y no debe ser considerada como consejo legal o fiscal. Si usted tiene alguna pregunta, por favor no dude en contactarnos a nuestra línea directa: (408) -293-6000, o visite nuestro sitio:www.foreclosurehelpscc.org o envíenos un correo electrónico: help@foreclosurehelpscc.org.

Nếu bạn là một sinh hoạt chủ sở hữu nhà ở San Jose hoặc Sunnyvale và đang đấu tranh với nợ nhà, xin vui lòng liên ForeclosureHelpSCC, một chương trình được tài trợ bởi thành phố San Jose và thành phố của Sunnyvale ở (408) -293-6000 hoặc truy cập trang web của chúng tôi: www.foreclosurehelpscc.org.

Nhân viên tư vấn của chúng tôi đã được HUD chấp thuận có thể giúp bạn đánh giá các lựa chọn của bạn, tìm hiểu thêm về các chương trình của liên bang và tiểu bang có thể giúp bạn với các vấn đề thế chấp của bạn, và sẽ giúp bạn tạo ra một kế hoạch phía trước.

Xin lưu ý: Tất cả các nội dung trên Blog ForeclosureHelpSCC được cung cấp thông tin duy nhất và không nên coi là hợp pháp hoặc tư vấn thuế. Nếu bạn có bất cứ câu hỏi , xin vui lòng liên hệ với chúng tôi qua đường dây nóng: (408) -293-6000, hoặc truy cập vào trang của chúng tôi: http://www.foreclosurehelpscc.org hoặc gửi email cho chúng tôi:help@foreclosurehelpscc.org.

Help with rental assistance after a foreclosure – What’s out there?

By Yvonne M. Castillo, Housing Counselor at SurePath Financial Solutions, one of the members of ForeclosureHelpSCC.

What’s out there for me to rent?” and “where to do I begin to research rentals?”With more people becoming displaced as a result of foreclosures, short sales or because of deeds-in-lieu of foreclosures, these questions are being asked by many, many people.

One place you can go to begin your search is at www.scchousingsearch.org. It is a very informative website to search for rental housing in Santa Clara County.  It provides information on various types of rentals including, apartments, townhomes etc. This website can help you find available rentals in different cities throughout Santa Clara County.  You can also call and speak with a live person who will assist you in looking for a rental- call Toll-Free: 1.877.428.8844.

Before you begin your search, it is a good idea to know what size rental you are looking for and how much you can afford to spend on rent. If you are looking to rent something larger such as a house, you can also check out websites such as www.zillow.com or www.craigslist.org. At www.craigslist.org you can tailor your search to different areas of the bay area.

Before you begin your search it is important that you review your credit history and score as a credit evaluation is required with most rental applications. You can order your credit reports from the three bureaus: Experian, Equifax and TransUnion through www.annualcreditreport.com.  Under the Fair Credit Reporting Act, each one of the three agencies (Experian, Equifax, and Transunion) is required to provide you a free copy of your report once a year.  While you are ordering your reports it is a good idea to purchase your credit score.  Your credit report is free but the scores have to be purchased- the fee is around $8.00 per score.

Check to see what is listed on your reports and also what your scores are before you submit a rental application to a landlord or property management company. You want to check for any unpaid debts or judgments within the last two years. If your credit report does have recent unpaid debts you can contact a HUD-approved credit counseling agency such as SurePath Financial Solutions to receive a free consultation to review options on improving your credit.

Note: If your report does show a foreclosure it will remain on your credit report for seven years but, the effects of the foreclosure will lessen with time – refer to the My FICO website.

With so many people seeking rental housing these days, landlords and property management companies can be very selective regarding whose applications they approve. Each landlord or property management company has their own set of guidelines to follow in order to approve an application. For example, a landlord or property management company may require a credit score of 650 or higher and your gross income to be two to three times the monthly rent. Some may require no recent bankruptcies and no convictions for specific criminal activity etc.

If you have a foreclosure or short sale on your credit report, it may be better to mention it to your potential landlord before they pull your credit report.  They may be willing to still rent to you if you put down a larger deposit, or if you have good references.  Or, if they tell you that they absolutely will not rent to somebody with a foreclosure or short sale, then you can save the fee that you will pay for them to pull your credit report.

Landlords will also check for recent unpaid debts or unresolved judgments and if you’ve been evicted from previous rentals or foreclosed homes. If you have recently paid some outstanding balances, it might not show on your credit report right away. If the updates are not reflected on the credit report, make sure to mention it with your application, so you can show proof of resolved debt issues and that may help you through the rental process.

Be prepared to pay a non-refundable fee of approximately $20-$35 per person in the application, for them to run your credit report.  If you are approved, you will be asked to pay a security deposit, first and/or last month’s rent. Some landlords or property management companies may consider a larger security deposit to allow for pets and they may request all adults over the age of 18 who will be living in the home to fill out an application.

If you do not qualify for a rental, some property management companies will send you a copy of your credit report they requested and will include the reasons why you did not qualify.

If you do not immediately qualify for a rental then another strategy is to see if you can possibly rent a room (www.craigslist.org also has listings from room rentals) or stay with family or friends for a short term while you find a more permanent housing. The qualification for renting a room might be simpler compared to an apartment, but you will still need to provide proof of income, a security deposit and possibly referrals from previous landlords. The option of renting a room will give you some time to increase your savings, pay off some debts and work on improving your credit so later you qualify to rent a place on your own.

One thing the rental application does not list but you will definitely need is a lot of is patience. You will need patience as you search for and apply for a rental because more people are looking to rent now. You will also need patience while working on improving your credit. As mentioned before, it may take up to 45 to 60 days for your credit report to reflect activity such as paying off debts. As stated above, if you would like information and assistance improving your credit, you can contact a HUD- approved credit counseling agency for a free consultation. Then, the next time you submit a rental application you will have a better chance of qualifying for the rental you are seeking.

If you are a homeowner living in San Jose or Sunnyvale and are struggling with your mortgage, please contact ForeclosureHelpSCC, a program funded by the City of San Jose and the City of Sunnyvale at (408)-293-6000 or visit our website: www.foreclosurehelpscc.org.  Our HUD-approved counselors can help you evaluate your options, learn more about federal and state programs that may help you with your mortgage issues, and will help you create a plan forward.

Please note: All content included in the ForeclosureHelpSCC blog is provided for information only and should NOT be considered legal or tax advice. If you have any questions, please feel free to contact us on our hotline: (408)-293-6000, or visit our website: www.foreclosurehelpscc.org or send us an email: help@foreclosurehelpscc.org.