The House of Representatives is set to vote on new protections for consumers’ credit rating sponsored by Rep. Josh Gottheimer.
The bipartisan Protecting Your Credit Score Act, scheduled to be voted on June 29, will create a new online credit portal to provide U.S. consumers with free access to their credit reports and scores. The legislation was introduced by Gottheimer and Rep. Tom Reed (R-NY).
Gottheimer noted there are three companies in the U.S. that dictate Americans’ financial futures when it comes time to buy a car, secure a mortgage for a house, qualify for a small business loan and the interest rate on credit cards.
“Each credit bureau comes up with their own magic number: your credit score. They have their own secret formula, and it’s up to each American consumer to track it, beg the credit bureaus to fix inaccuracies and acts of fraud, and deal with data breaches, which occur far too often,” said Gottheimer. On the average, It takes credit fraud victims three to six months to resolve the issues.
The specifics of the bill are:
- Direct the three credit reporting bureaus to together create one online portal to provide free and unlimited access to credit reports and scores;
- Provide the ability to initiate and resolve disputes between a consumer and a credit bureau;
- Provide consumers with access to see who the bureaus have sold their data to in the prior two years; and
- Direct the Government Accountability Office to examine the most secure and accurate marker to track a consumer’s credit—whether with a Social Security number or another federal identifier.
The Federal Trade Commission has found that 1 in 5 consumers have verified errors in their credit reports, and 1 in 20 consumers have errors so serious they would be denied credit or forced to pay higher interest rates.
In terms of data breaches, the most notable case occurred in 2017 when Equifax lost the data of more than 147 million people in their breach and left it up to American consumers to clean up the mess.
During the coronavirus public health crisis and economic downturn, the U.S. is seeing spikes in new types of fraud related to direct relief payments and PPP loans, which Gottheimer believes creates even more urgency for Americans to have better tools to protect their credit and resolve disputes.
“Through good times and bad, we need to be helping Americans protect and strengthen their credit and their own financial future,” said Gottheimer.