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"The huge impact of credit reports"

By admin | January 3rd, 2010 | Featured, General

Our credit reports are something that most of us know exist but until recently many of us had never bothered to take an interest in. It is only since the onset of the global credit crunch, when lending criteria became increasingly stringent and credit conditions became extremely tough, that many people realised that their credit cards had such a huge impact on their financial futures and capabilities.

In many cases the damaging data on a credit report is not through the fault of the consumer who report it is but as a result of a mix up or mistake, which the consumer then ends up getting penalised for. This problem was recently highlighted by a member of the Treasury Select Committee, forty nine year old MP John Mann. In an unfortunate incident Mr Mann’s details became confused with another person of the same name, and he suddenly found himself in financial turmoil.

Mr Mann’s credit card provider is said to have cut his credit limit from £12,500 to just £1750 as a result of the mix up. He also found that he was unable to get any credit from other providers. The Treasury Select Committee has since been investigating the problem of mistakes and inaccurate information on credit files and how these can affect the consumer, and Mr Mann himself has raised the issues with the major credit reference agencies, which are CallCredit, Equifax, and Experian.

Mr Mann was concerned that whilst the agencies charge consumers for the information that is on the credit reports they are not taking enough responsibility to get it changed quickly when mistakes are highlighted, which then leaves the consumer in limbo. He said that often mistakes were made by the credit reference agencies or by financial institutions, which then passed the responsibility between one another, which did nothing to help the consumer.

He went on to state that he only discovered the mistakes on his own credit report by chance when he received someone else’s bank statement. Mann went on to suggest that if something like this could happen to him, and MP with no debt, then the situation must be much worse for his constituents. He said he is still finding it difficult to get credit as a result of the inaccurate information, which goes to show just what a profound impact something as simple as a credit report error can have.

Many different examples of mistakes made on credit reports, which had then impacted on the credit worthiness of the consumer, were brought to light. This included a case where a man’s loans had been left open on his credit file even though he had repaid them all, another case where a man was refused credit for not being on the electoral roll even though he was a voter, and many cases where confusion had occurred due to people sharing the same name and date of birth, which was what had happened in Mr Mann’s case.

Tags: available credit, bad credit, credit reports, credit scores, good credit

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