When it comes to obtaining personal loans, your
FICO credit score is perhaps the single most important determining factor. Credit scores
are calculated based on information that appears on your credit report.
Due to recent changes, millions of consumers stand to see an improvement
in their credit rating.(1)
The three leading consumer credit bureaus, Equifax, Experian, and TransUnion,
have all made substantial changes to which information will appear on
an individual's credit report, namely the exclusion of tax liens and
civil judgements if they do not provide complete details about the consumer.
Need Help With An Error On Your Credit Report? Call Our Lawyers!
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Tax Liens and Civil Judgments
A tax lien is a legal claim issued on one’s personal assets that
tends to occur when they have lapsed on payment of a tax debt. Tax liens
may be entered by the Federal Government (IRS), or by a State's tax
Civil Judgment refers to any ruling against a defendant in a Civil court. These judgements
can come about as a result of a lawsuit or the signing of a
confession of judgment.
Prior to the recent changes, both civil judgments and tax liens would frequently
appear on consumer credit reports through the reporting of public records data.(2)
Changes to Credit Reporting
As of July 1st, 2017, the three largest consumer credit-reporting agencies
no longer include any information in regard to tax lien and civil judgements
on credit reports that do not achieve their standard of accuracy. If a
tax lien or civil judgement does not include an individual's name,
address, social security number and/or their dates of birth, it will no
longer appear on their credit report. Given that many tax liens and civil
judgment filings don’t meet these criteria, a substantial number
of them stand to be purged from consumer credit reports.(3)
These changes were not ordered by any governmental agency and are a completely
voluntary action by each of the firms. While this information will no
longer be present on consumer credit reports, lenders will still have
access to this information via other data collection companies. Companies
such as Chronos Solutions and LexisNexis will still be able to access
public records and offer that information to lenders in a separate report.(4)
What the Changes Mean for You?
It has been reported by The New York Times (4) (via FICO statistics), that
approximately 7% of Americans stand to have a tax lien or judgement removed
from their credit report. If you are among those affected, your credit
will likely change by a small, but not negligible, amount.
FICO claims that the average increase in credit score amongst affected
consumers will be around 20 points.
Credit Repair Lawyers in New York
While the recent changes are a move in the right direction, credit reporting
issues continue to persist, and bureaus are not always quick to make corrections.
Unfortunately, all too often, consumers find their credit reports to contain
misinformation or records of outdated information that should be deleted. The
Fair Credit Reporting Act (FCRA) is a federal law that was enacted to ensure accurate credit reporting
and provides for monetary recovery in situations where the a credit bureau's
unlawful conduct causes damages upon a consumer.
Our lawyers are experienced in analyzing credit reports and helping to
dispute incorrect and outdated notations. We can also represent consumers
in bringing legal action against credit bureaus and credit reporting agencies
for violations of FCRA. If you're seeking the help of a professional
advocate, call the Law Office of Simon Goldenberg PLLC today to learn
how we can help you.
Have your rights been violated by a Credit Bureau?
credit lawyers for a free phone evaluation! (888) 301-0584
As reported by the Wall Street Journal, Citing FICO Data
Sewell, Taelonda. (What is a Civil Judgement, https://www.legalmatch.com/law-library/article/what-is-a-civil-judgment.html)
McCoy, Kevin (Consumer Credit Scores Reportedly Will Soon Exclude Tax Liens
and Some Civil Judgments, https://www.usatoday.com/story/money/2017/03/13/reports-credit-scores-soon-exclude-some-debts-liens/99113572/)
Cowley, Stacy. (Your Credit Score May Soon Look Better, https://www.nytimes.com/2017/06/26/business/dealbook/your-credit-score-may-soon-look-better.html)
*Not legal advice. For informational purposes only.