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Adverse Action Free Credit Score Amendment
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If you are denied something because of your credit history (known as an adverse action), whether it’s a credit card, line of credit, or a job (or anything else), you will receive a letter that explains why you were denied. You will also be able to get a copy of the credit report used to reach that decision along with the applicable FICO risk factor reasons. This copy is outside the one you can get for free every twelve months because of the Fair Credit Reporting Act.
Earlier this week, the Senate passed an amendment that would expand your rights after you’re denied credit. It’s part of the Wall Street reform bill and it would expand the free credit report to include a free credit score as well. It was an amendment (S. 3247 Fair Access to Credit Scores Act of 2010) offered by Senator Udall (D-CO) and it was passed earlier this week. (from a procedural standpoint, he introduced S. 3247 and it was rolled into the larger Wall Street reform bill)
End result? If the reform bill passes, you will be given access to your credit score in the event of an adverse action such as a denial of credit or rejection of employment.
All I can say is – what took so long? What do you think?
(Photo: thetruthabout)
{ 15 comments, please add your thoughts now! }Related Posts
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I think that these should be combined anyways. Although I know it will not happen because it would evaporate their revenue streams.
Who pays for it? Credit scores aren’t free.
In theory, the credit bureaus would but in the end that cost will simply be passed onto lenders and borrowers.
I think anything that has that much impact on our lives should be free to everyone, without the need to get a denial first. How would everyone feel if in high school all your grades were kept secret unless you paid for them or had to go through a process to get them, except if you were denied entry to college because of your grades.
So you would only get the free score if you are denied credit? I take it that means you wouldn’t get a score when simply checking your credit report when your credit is otherwise okay?
Yes, that appears to be the case.
Would this apply to rentals? As a landlord, if I run someone’s credit and decide not to lease to them, I would have to do that?
Rentals are included, as not renting to someone is considered an adverse action. In theory, the credit bureau pays but in actuality it’ll probably be passed onto you through higher fees on the inquiry.
I think it is fair to tell someone why you turned them down.
They then have a choice. They can choose to look elsewhere, fix an error if it exists or look to change things within their control.
Bill Snider
Its a great idea. Hopefully it can act as a wake up call to people and give them the actual information they need to correct their use of credit.
Finally the government propose some worthy legislation!! I agree with cubiclegeoff, given the impact the score has on our lives, it should be free regardless.
This is GREAT news. Thankfully I am on a credit upswing as I have been working to get debt free, but I feel this will be great for all of the people out there who are not educated on credit reports and scores. I just hope that people will actually take advantage if this is passed.
I think this is a great idea. The report has the truly useful information but the score can be helpful.
I just read this on Consumer Reports. I agree with them that they should have made it free to everyone. It’s weird how we can see our reports but not our scores.
I want to chime in my agreement with everyone else. This is fantastic that we’ll finally see our score, if you’re rejected. It’s a shame that if someone with a good credit history wants their score, they have to pay for it…