Viewpoint: Credit agencies and a menacing merger

This page highlights efforts by Consumers Union to improve the marketplace

Published: May 2014

Cleaning up the credit agencies

The issue: Millions of Americans have errors on their credit reports that could result in higher interest rates and pricier insurance, and possibly even missed job opportunities. Trying to fix those mistakes often adds to the nightmare.

Our take: Policymakers and regulators must rein in those harmful abuses. Thankfully, change is on the horizon.

The Consumer Financial Protection Bureau recently told financial firms that it would take action if they fail to fix errors on credit reports. It also called on banks to voluntarily provide reliable credit scores at no cost. It turns out that the scores consumers purchase are usually different from what lenders see—a murky tactic.

In April, Sens. Brian Schatz, D-Hawaii, and Sherrod Brown, D-Ohio, introduced legislation endorsed by Consumers Union that would require credit bureaus to follow tight rules for ­ensuring accuracy while mandating free access to consumers’ actual scores.

“That’s especially important for those without bank accounts or credit cards who don’t qualify for current voluntary programs,” says Maureen Mahoney, public policy fellow for Consumers Union. Go to ­DefendYourDollars.org to read Mahoney’s investigation (PDF) into the impact of faulty credit reporting.

Update: A menacing merger

Consumers stand to lose big if Comcast and Time Warner Cable join forces. While the government weighs its decision on whether to approve the merger, more than 130,000 Consumers Union activists signed a petition at HearUsNow.org in opposition of the move.

Comcast and TWC already rank toward the bottom of the barrel in our surveys on customer satisfaction, and a merger would leave little incentive to improve. It’s a bad deal, and we’ll keep fighting against it.

State lines: College is free in Tennessee

The Volunteer State is living up to its nickname as Tennessee legislators have passed a plan that provides in-state high school graduates with two years of free tuition to local community colleges and technical schools.

Consumers Union believes students shouldn’t have to mortgage their future for an education. That’s why we’re working to bring relief to students already struggling with loans (video), while helping to create fairer options.

"Though his own life was short, Cameron inspired a regulation that will save the lives of countless others."

 

—Greg Gulbransen, a pediatrician whose 2-year-old son was backed over by an SUV and killed, on the newly issued rule that effectively requires rear-view cameras in vehicles by May 2018. In a 2008 law named for Cameron, Congress directed the Department of Transportation to issue a rear-visibility standard by 2011. But the DOT didn’t issue it until this spring, after Gulbransen and a coalition of advocates, including CU, sued the agency.

Editor's Note:

This article also appeared in the July 2014 issue of Consumer Reports magazine.



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