Credit-reporting giants Equifax Information Services, Experian Information Solutions and TransUnion will change the way they handle errors and treat medical debt after reaching a settlement with New York Attorney General Eric Schneiderman.
The deal calls for changes on a national scale. It requires the credit-reporting firms to institute several reforms in the next three years, including giving consumers the right to challenge inaccurate information in their credit reports by initiating a dispute. The bureaus, in disputed cases, will be required to use trained employees to review all supporting documents submitted by consumers who see an error in their files, even if the creditor reports the information is accurate. Credit-reporting agencies typically deal with disputes by converting the consumer's claim into a three-digit code and sending it to creditors to confirm or deny the accuracy. The three bureaus also agreed to wait 180 days before putting past-due medical bills on credit reports to allow insurance payments to be taken into account. All medical debts will be removed from a consumer's credit report after the debt is paid by insurance. Equifax, Experian and TransUnion collect and provide credit information on more than 200 million consumers in the U.S. "The nation's largest reporting agencies have a responsibility to investigate and correct errors on consumers' credit reports. This agreement will reform the entire industry and provide vital protections for millions of consumers across the country," Schneiderman said.The three bureaus launched the plan on Monday. Implementation will begin over the next few months.
The changes are intended to provide people with more transparency and easier navigation when dealing with the bureaus that hold their credit reports. The announcement Monday arrived after months of negotiations between the firms and Schneiderman's office.