40 million credit files contain incorrect information that consumers have to “jump through numerous hoops” to correct, according to a statement made by the office of Representative Maxine Waters (D-California). Representative Waters recently introduced a new bill, the “Comprehensive Credit Reporting Reform Act of 2016”, which would:
“reduce the amount of time that most adverse information stays on a person’s credit report and mandate that paid debts be removed within 45 days, HousingWire reported. It would also give the CFPB ‘explicit authority” to monitor the development of credit reporting agencies’ scoring models and require the Federal Housing Finance Agency to study the possibility of using alternate credit scoring models. The bill would also give the CFPB authority to cap prices of direct-to-consumer sales of products and services from credit reporting agencies if such costs are unfair or unreasonable.”
While the chances of a bill strengthening the CFPB’s authority (over anything) becoming law in advance of the November election are minimal, this proposed legislation does add color to the ongoing debate over fairness in credit scoring.
Overview by Alex Johnson, Director, Credit Advisory Service at Mercator Advisory Group
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