Credit Dispute Process Set to Get Simpler



Struggling to remove stains from your credit reports? Here’s some good news for you, if you have the right documentation to prove what went wrong.

Credit bureaus — Experian, TransUnion, and Equifax – have decided to go through the evidence you send to back up the reason for the stain in your credit report and transmit it electronically to lenders through their internal portal known as e-OSCAR to let lenders know the reasoning behind your dispute. The agencies will also help consumers communicate matters directly to their lenders.

Previously, in the report sent by credit bureaus to lenders, consumer evidence was not included because e-OSCAR wasn’t tailored to accept them. This practice drew criticism from consumer advocates as it limited the scope investigating a dispute from a 360 degree perspective – especially if a consumer’s evidence was strong enough to settle the dispute.

In many cases, consumers have been the victim of mixed file errors. In this type of error, information that doesn’t belong to a consumer gets reflected in their reports. This mostly happens because of identification errors arising due to a credit reporting agencies practice of using a part of a consumer’s Social Security number —and not full— to match consumers to an account. To remove an error of this kind usually takes the consumer a lot of harassment. At times it has to be resolved with the help of a lawyer. With the introduction of customer evidence, this process (mixed file error) is set to get simple and hassle free.

The process of documenting consumer evidence would go well with lenders, say analysts. This is because they are keen to make the process transparent so that legal hassles are removed from the way. What they strongly feel is that in case they are not getting things right, the documentation will help them put things straight.

Those lenders, who are not very keen about this new concept, would have no choice but to use it because the system mandates the lender to take consumer documentation into account. If the lender flouts it, then the case would stack up heavily against him especially if it is proved that the consumer was not at fault.

All said and done, the new move will go a long way to restore credibility of the credit industry.

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