Consumer Financial Services Law Blog
Dykema Gossett PLLC
Dykema Gossett PLLC

Consumer Financial Services Law Blog

Consumer Financial Services Law Blog

News and analysis regarding Consumer Financial Services litigation and regulation, and activities of the Consumer Financial Protection Bureau


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Showing 4 posts in Credit Reporting.

The Fed Confirms That Credit Extension to Subprime Borrowers Remains Low

In its August 2015 Quarterly Report on Household Debt and Credit (the “Report”), the Federal Reserve Bank of New York confirms that new mortgage loans to subprime borrowers remain incredibly low, with just 8 percent of new mortgages given to borrowers whose credit scores were below 660. According to a blog post accompanying the Report, “Underwriting standards for mortgages have loosened only slightly in the years since the Great Recession.” Read More ›

CFPB Concludes Medical Debts Unduly Harm Credit Scores

On May 20, 2014, the Consumer Financial Protection Bureau (CFPB) issued a data point report that focused on whether consumers with medical debts were overly penalized for medical debts that go into collection and show up on their credit reports. The CFPB confronted two questions in the report: (1) “whether medical and non-medical collection are equally predictive about the subsequent respective credit performance of consumers with these different types of accounts” and (2) “whether paid and unpaid medical collections are equally predictive of consumer delinquency rates.” In assessing these questions, the CFPB reviewed about five million anonymized credit records. The answer to both questions—according to the CFPB—is no.   Read More ›

New York Attorney General’s Action Against Debt Buyers Requires Renewed Compliance Focus on Calculating the Statute of Limitations and Providing Credit Reporting Disclosures

New York Attorney General Eric T. Schneiderman announced settlements last week with two major debt buyers, Portfolio Recovery Associates, LLC (PRA) and Sherman Financial Group, LLC (Sherman), resolving allegations that PRA and Sherman filed lawsuits after the expiration of the applicable statute of limitations (SOL) and continued to collect on judgments they wrongfully obtained. The companies will: (i) pay a combined $475,000 in penalties, (ii) vacate and stop collections on approximately $16 million in judgments, and (iii) make various disclosures regarding the SOL and credit reporting to consumers. Two aspects of the settlements deserve significant attention, and if they not already part of your compliance management system, should be considered for inclusion immediately.  Read More ›

CFPB Now Accepting Complaints Regarding Credit Reporting: Credit Reporting Agencies Should Prepare For Burdens Of Complying With the CFPB Consumer Complaint System

Following the CFPB’s study that found discrepancies regarding credit scores and reporting, it should come as no surprise that the CFPB has expanded its complaint database to include credit reporting. Director Cordray explained that the CFPB made this change because, “[c]redit reporting companies exert great influence over the lives of consumers” and “[c]onsumers need an avenue of recourse when they feel they have been wronged.” This action also means that credit reporting agencies will now bear the burden (and cost) of responding to those the complaints pursuant to the CFPB’s protocols. Read More ›