2020 was a tough year for governments and consumers alike. In a year full of difficulties in all walks of life, it’s no surprise that consumer complaints regarding credit reporting errors doubled the amount recorded in 2019! In 2020, consumers filed over 280,000 complaints about inaccuracies and errors on their credit reports with the Consumer Financial Protection Bureau. The question many of us are left asking ourselves is, “why are there so many more credit reporting errors?” and “do I need a credit report attorney?”
We have previously discussed how accurate consumer reporting is important for any consumer’s future. Errors and inaccuracies on these reports can have lasting ramifications on someone’s financial future and quality of life, which is why it’s so important to protect consumer reputation and ensure all information about an individual’s transactional history is accurate.
This article will examine some of the reasons behind the large spike in credit reporting errors in 2020 and what consumers should do to protect themselves and their credit ratings from troublesome inaccuracies.
Common Credit Reporting Errors in 2020
You don’t need us to remind you of how challenging and unorthodox 2020 was. But, it’s worth educating yourself on the common credit reporting errors that increased in 2020 and determine whether or not your credit score fell because of the following reporting errors:
Inaccuracies with student loan payments
In 2020, state and federal governments put in new consumer protection measures for students facing lofty student loan payments. These protections were put into place to help alleviate debt for young people entering the workforce, which was all but put to a halt because of the pandemic. Most of these protections are still in place as of April 2021.
The debt collection system for student loans was notoriously inefficient before the pandemic, and the problems were only exacerbated by it. Under the CARES Act, federally backed student loans will require no payments through Sept. 2021. Right now, student loan borrowers’ credit reports are supposed to account for the payment hiatus; however, this isn’t always happening, and many borrowers are finding that their credit score has taken a hit.
Inaccuracies with mortgage loan payments
Some federally backed mortgages have also been granted payment hiatus, so borrowers don’t default on their mortgages and lose their homes. However, just like the student loan borrowers, some home buyers are finding strikes against their credit report. This is due to false reporting that they have lapsed on their mortgage payments, even though in their particular case, the payments have been deferred.
Fraudulent Quick Credit Repair Services
Amid the pandemic, many scamming services have claimed that for a one-time fee, they will quickly “scrub” credit reports, remove inaccuracies, and improve your credit score in minutes. These promises and claims are not true, and agencies reporting to offer this service are not truthful about credit repair.
Unfortunately, many people have engaged with these companies and believe that after paying once for the services, their credit inaccuracies and errors have been cleaned, like an eraser cleaning a dry-erase board. Not only does this scam innocent consumers out of money for the service, but it also can lead to the credit issues becoming worse because the errors are left unfixed while the customer thinks they have been rectified.
These “credit fixer” companies have become such an issue that the Consumer Financial Protection Bureau issued an advisory on watching out for these particular predatory practices.
Connecting With a Credit Report Attorney
When someone is suffering from inaccurate reporting on a consumer report, it negatively affects all aspects of their life as a consumer. The pandemic has made navigating the paths to rectifying these errors even more difficult.
An already-taxed system of checks and balances with federal agencies and credit bureaus is even more strained. That is why working with a credit report attorney can be the best path forward for people suffering from credit reporting errors, at no fault of their own.
At Holland Law Firm, we’ve been helping consumers protect themselves against fraudulent errors on their consumer reports long before the pandemic changed the world, and there’s a path forward today, as well.
If you’re facing a seemingly insurmountable consumer reporting problem(s), our credit report lawyers and student loan attorneys are at your service.