Last week, Rep. Maxine Waters (D-Calif.) introduced new legislation called the “Comprehensive Consumer Credit Reporting Reform Act of 2016,” according to a HousingWire report. If passed, the act would “overhaul the American credit reporting system so that it is fairer, more accurate, and less confusing for consumers,” Waters’ office said.
Right now, credit reporting agencies compile credit information for about 200 million people. About 40 million of those files contain incorrect information, and consumers usually have to “jump through numerous hoops” to get it corrected, Waters’ office said.
Waters’ proposed legislation 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.
The bill also allows borrowers who have been “victimized by unfair, deceptive of abusive acts or practices” by mortgage lenders or servicers to have adverse mortgage loan information purged from their credit reported, according to HousingWire.
A new bill would give the Consumer Financial Protection Bureau “explicit authority” to monitor how credit reporting agencies develop credit scoring models.