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U.S. consumers are frustrated by errors in credit reporting, according to a new report.
The report by U.S. PIRG Education Fund, a nonprofit organization, looked at consumer complaints filed with a database maintained by the Consumer Financial Protection Bureau (CFPB) and found that credit-reporting problems doubled from 2021 to 2022.
In 2022, the CFPB published 800,394 complaints from consumers, a 61% increase from the previous year, where 496,000 complaints were filed. Within this group, credit-reporting complaints increased by 96% from 2021 to 2022. Credit-reporting complaints stood at over 600,000 in 2022.
“Americans are angry at credit-reporting system,” the report’s title read.
“I’ve studied credit-reporting complaints for over 30 years, yet I cannot comprehend how little the credit bureaus’ poor treatment of consumers has changed,” Ed Mierzwinski, senior director for federal consumer programs at U.S. PIRG Education Fund, said in a statement.
“When Americans describe a system rigged against them in the stories they file into the CFPB database, it’s unfortunately not surprising — I’ve seen it all before,” he added.
The report also noted that the three dominant credit bureaus received more consumer complaints than any other financial firm in 2022. Credit-reporting issues against the three big credit bureaus made up 69% of the 800,000 complaints the CFPB received in 2022.
The three companies facing the most consumer backlash were TransUnion
TRU,
Equifax
EFX,
and Experian
EXPGY,
MarketWatch has reached out to TransUnion, Equifax and Experian for comment.
Year-over-year, complaints against Experian rose by 334%; TransUnion by 183%; Equifax by 24%.
| Top 5 national complaints in 2022 | Total |
| Incorrect information on your report | 229,638 |
| Improper use of your report | 210,792 |
| Problem with a credit-reporting company’s investigation into an existing problem | 153,539 |
| Attempts to collect debt not owed | 31,112 |
| Managing an account | 22,769 |
Consumers in Florida reported the highest number of complaints in 2022, at 98,277, according to PIRG. Texas and California residents ranked second and third, at 86,578 and 80,094 each.
Residents in Wyoming had the least number of complaints at 337.
These three companies, TransUnion, Experian and Equifax, are the biggest players in credit reporting in terms of volume, so the findings are not a major surprise, Ted Rossman, senior industry analyst at Bankrate, told MarketWatch.
“Your credit score is a very important number, of course, and most people don’t pay much attention to their credit scores until they’re in the market for a loan. If they get turned down because their credit score is too low, they might take that anger out on the credit bureaus,” Rossman said.
“A lot of people don’t understand what goes into a credit score or report — they just get mad when a lending decision doesn’t go their way,” he added. “Rising interest rates are probably contributing to sticker shock as well.”
Rossman also offered three tips for consumers who are facing these issues:
First, keep track of your score at this free website to avoid nasty shocks.
Second, don’t sleep on any potential issues — proactively report the error to the credit bureau and your bank or financial institution even before you try to apply for a new loan.
Lastly, try to not only improve but protect your credit score by forming good habits like paying bills on time and keeping debt balances low, Rossman said.
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