I have heard that there are major changes coming on credit reports shortly. Will it help most consumers as the news has indicated and when is the change coming?
--Carolyn from Kansas
I have asked Chad Kusner of Credit Repair Resources to comment on this question. Chad is on the Board of Directors of NACSO, the National Association of Credit Services Organizations. He can be reached at 888.927.7760/[email protected]
Important news hit the credit reporting and lending world recently. It is potentially big news for millions of Americans and thousands of lenders. In the ongoing effort to provide accurate credit reporting to consumers, the three major credit reporting agencies, Equifax, Experian and TransUnion have announced that in July 2017, many tax liens and judgments will be removed from consumer credit files.
I would like add insight into why this move was made by the CRAs. The key reason is identifiers. As part of the ongoing overhaul of the credit reporting system, entities that report information to our credit reports, otherwise known as furnishers, must provide specific information that accurately ties the account to the consumer's credit file. Public records like tax liens and judgments often do not contain the required identifiers that permit those accounts to be reported. After July of this year, any lien or judgment that does not contain the proper information will be purged from consumer files.
There is always a caveat. We must consider that government agencies and lien holders are not going to take lightly to this. I will make the assumption that there will be pressure applied to court houses and Lexis Nexis to improve their record-keeping. It is also important to know that this will not affect all Americans with these items. If the lien or judgment does contain the proper identifiers, it can remain on the consumer's credit file. This summer is looking to be very interesting for our industry!
Dave Hershman has been the leading author and a top speaker for the industry for decades with six books authored and hundreds of articles published. His website is www.originationpro.com. If you have a reaction to this commentary or another question you would like answered in this column? Email Dave directly at [email protected].
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