Equifax Data Breach

New York Consumer Law Blog

Friday, April 21, 2017

Beware, mortgage seekers: Random, online ‘credit scores’ are not always reliable

A new legal settlement from the Consumer Financial Protection Bureau alleges that Experian, one of the big three credit-reporting bureaus, “deceptively marketed credit scores to consumers by misrepresenting” them as “the same” as what their lender would use in determining whether and on what terms to offer them a loan.

 

 In fact, said the bureau, the scores Experian advertised extensively were its own proprietary “educational” scores that virtually no lenders use to make credit decisions.

 

As part of the settlement, Experian was fined $3 million. The case follows Consumer Financial Protection Bureau settlements in January over similar allegations with the other national credit bureaus — Equifax and TransUnion — in which they were required to make $17.6 million in restitution to consumers and pay $5.5 million in fines. TransUnion and Equifax were accused not only of falsely representing the usefulness of their in-house educational scores but also luring consumers into “costly recurring payments for credit-related products with false promises.” All three bureaus denied any wrongdoing.

 

http://https//www.washingtonpost.com/realestate/beware-mortgage-seekers-random-online-credit-scores-are-not-always-reliable/2017/03/28/eb8aa4a8-131d-11e7-9e4f-09aa75d3ec57_story.html?utm_term=.e020d1527f33


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