Wednesday, December 26, 2007

Big Three Credit Companies Getting Too Much Power

The scenario below is happening all to often in this industry. Something needs to be done in order to protect the consumer. The credit bureaus truly do have too much latitude in more ways than one

An agent wrote, “I pulled credit, over the weekend, with no phone numbers or data listed other than name, social & address, and my client has since received 3 phone calls from various lending institutions stating that he recently had his credit pulled and they can offer better rates. My client was furious…” Federal Trade Commission Chairman Deborah Platt Majoras says her agency has done a credible job regulating the Big Three credit bureaus. But there is criticism that the FTC has given Experian, Equifax and TransUnion too much latitude to profit from the sale of credit data to lenders and consumers, especially since federal agencies, that are supposed to be looking out for the consumer, are really protecting the companies that do bad things the agencies were set up to prevent. In February, the National Association of Mortgage Brokers criticized the FTC for giving the credit bureaus tacit approval to keep selling listings containing personal and financial data of prospective borrowers. Some unscrupulous lenders used trigger lists to contact people who recently filled out a loan application, and then pitched them alternative mortgages. Most applicants never knew the bureaus were placing them on trigger lists and were surprised to be deluged by phone calls and e-mails. In addition, privacy and consumer advocates are calling for the FTC to do more to bring order to the profusion of websites selling credit scores and credit services derived from credit data sold exclusively by the Big Three.

Jason Wheeler

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