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Was a loan denied because of an error on Equifax’s credit report? Here’s how to find out

The credit monitoring company Equifax filed the error Credit scores Sent to millions of US consumers and lenders between mid-March and early April. Some scores are erroneously increased or decreased by more than 20 points, affecting Interest rates Lenders offer and, in some cases, encourage loan applications to be denied.

Equifax said in an Aug. 2 statement that the error was due to a coding problem, and the scores were reset.

“Our data shows that fewer than 300,000 customers experienced a score change of 25 points or more,” Equifax said. “Even if the score has changed, a score shift does not necessarily mean that the consumer’s credit decision has been negatively affected.”

The company added that it is working with financial institutions that use it to “determine the true impact for consumers.”

The Consumer Data Industry Association, which represents credit-reporting agencies such as Equifax, Experian and TransUnion, told The Washington Post that getting credit reports right is “critical.”

But, in a January report, the Consumer Financial Protection Bureau, a government watchdog, called “America’s credit reporting oligopoly” a pattern of inadequately responding when consumers complain about errors on their credit reports, a “surveillance business model with serious damages resulting from their faulty finances.”

What should you do if you think you were denied a loan because of Equifax’s mistake? We explain below.

Who was affected by Equifax’s credit reporting error?

If you were denied credit between March 17 and April 6, 2022 — for a credit card, car loan, mortgage or other line of credit — it could be the result of a mistake by Equifax.

Mortgage lenders requested about 2.5 million credit scores in a three-week window, according to the Wall Street Journal, but because they typically request reports from all three credit agencies, it’s hard to know how much impact the error had.

Equifax changes less than 300,000 accounts by 25 points or more in either direction.

What can you do if you think you’ve been denied credit because of Equifax’s mistake?

Thomas Nitsche, senior director of media and brand at Money Management International, a nonprofit credit counseling agency, says people who think they’ve been wrongly denied credit should contact their lenders to find out if they used Equifax to make a credit decision.

In a statement emailed to CNET, Equifax encouraged borrowers who think they may be affected to “reach out to their lenders for more information.”

If you find your score is incorrect because of a coding problem, you can file a complaint with the lender and the CFPB, as well as your state’s attorney general’s office.

If you still want a loan, you can request that another credit bureau be used to make the decision.

“They should document the incident, because I expect a class action suit could come,” Nitse said.

Financial institutions are seeking more information from Equifax, the Journal reported, and are considering remedies for loan seekers who were assigned artificially high interest rates or turned down for loans.

You can get a lower interest rate

Individuals affected by Equifax’s error may not have been turned down for a line of credit, but their interest rate may have been incorrectly listed.

If you were approved for a line of credit between March 17 and April 6 — “probably a little earlier to account for insurance delays,” Nitzsche said — you may be eligible for an interest rate adjustment.

Contact your lender and see how they determined your rate. If it’s using the wrong Equifax score, see if you can get a retroactive credit for the interest you’ve already paid based on your current rate.

“This is especially true for consumers who know they’ve been affected,” Nitse said.

Check your credit score

Even if you don’t apply for a loan this spring, you should regularly check your credit score for any irregularities. You can check your credit score through companies like Credit Karma and MintOr usually through your bank or credit card.

Americans too Eligible to receive free weekly credit reports From TransUnion, Equifax and Experian. Credit reports contain information about your current credit situation, such as the status of your accounts, any collection items or judgments, and your loan repayment history.

Equifax credit reports can be received by registering for a free myEquifax account.

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