Credit bureaus won't be divulging consumer risk scores anytime soon, but at least one major bureau is ready to add detail to its credit reports.
TRW Information Systems and Services Inc. appears poised to be the first to deliver more detailed credit reports, which would show consumers how their credit histories compare with those of others.
The Orange, Calif.-based credit bureau began considering using more detailed credit reports after a Federal Trade Commission ruling last September stating that credit bureaus are not required to disclose so- called risk scores.
The FTC and the financial services community fought bitterly for nearly three years over whether consumers had a right to see risk scores, in which a consumer's creditworthiness is reduced to a single number.
The number, calculated using scoring model techniques, varies depending on a lender's underwriting criteria. The credit reporting industry argued that consumers would only be confused if they knew their risk score, because it can vary over time and with different lenders.
Credit bureaus still oppose the disclosure of risk scores, but TRW responded to the clamor by moving to expanded credit reports.
"Our credit report has improved over the years," said Martin E. Abrams, director of TRW Inc.'s privacy and consumer policy, "but it still does not give people the ability to compare their credit performance with other consumers, to have a sense of what the data in the report really means."
For example, a person who pays bills on time but also has a large amount of revolving debt would be viewed differently by lenders from a person who is not a heavy revolver and also pays bills on time.
Credit reports today do not help consumers evaluate their credit behavior, said Mr. Abrams. "They don't say that you have 23 open lines of credit and the typical consumer has 15."
Mr. Abrams declined to provide specific examples of how and when TRW's credit reports might change, but he said the company is considering various options.
The other two major credit bureaus, Equifax Inc. and Trans Union Corp., said they do not have any plans to change their credit reports.
"We already provide explanatory information," an Equifax spokesman said, adding the Atlanta-based company refers consumer queries to its Consumer Information Service Center, which last year, fielded more than 10 million calls.
Trans Union pointed out that it recently revamped its credit reports to highlight derogatory information.
Mr. Abrams said that TRW's plans will likely influence its competitors, "creating competitive pressure for them to do the same."
