Equifax Sent Lenders Inaccurate Credit Scores on Millions of Consumers

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During a three-week period this year, Equifax sent faulty scores to lenders, resulting in higher interest rates and denied applications
 

Equifax Inc. pro­vided in­ac­cu­rate credit scores on mil­lions of U.S. con­sumers seek­ing loans dur­ing a three-week pe­riod ear­lier this year, ac­cord­ing to bank ex­ec­u­tives and oth­ers fa­mil­iar with the er­rors.

 

Equifax sent the er­ro­neous scores on peo­ple ap­ply­ing for auto loans, mort­gages and credit cards to banks and non­bank lenders big and small—in­clud­ing JP­Mor­gan Chase & Co., Wells Fargo & Co. and Ally Fi­nan­cial Inc., the peo­ple said. The scores were some­times off by 20 points or more in ei­ther di­rec­tion, the peo­ple said, enough to al­ter the in­ter­est rates con­sumers were of­fered or to re­sult in their ap­plications be­ing re­jected al­to­gether.
 

The in­ac­cu­rate scores were sent from mid March through early April, the peo­ple said. The com­pany be­gan dis­clos­ing the er­rors to lenders in May, they said.
 

Equifax said it has since fixed the er­ror, which the com­pany de­scribed as a “tech­nol­ogy cod­ing is­sue.” The glitch didn’t al­ter the in­for­ma­tion in con­sumers’ credit re­ports, the com­pany said.
 

Equifax main­tains credit re­ports on more than 200 mil­lion U.S. con­sumers and sells them to lenders. The in­for­ma­tion in these files—in­clud­ing whether con­sumers are ap­ply­ing for debt, the types of ac­counts they have and whether they have a his­tory of pay­ing on time—de­ter­mines con­sumers’ credit scores. Credit scores are among a num­ber of fac­tors lenders con­sider when mak­ing loan de­ci­sions.
 

The glitch is an­other set­back for Equifax, which fell vic­tim to a hack in 2017 that ex­posed the sen­si­tive per­sonal in­for­ma­tion of nearly 150 mil­lion Amer­i­cans.
Trade pub­li­ca­tion Na­tional Mort­gage Pro­fes­sional re­ported on the glitch in late May, say­ing Equifax had no­ti­fied lenders of er­ro­neous scores dur­ing the pe­riod in ques­tion.

 

https://www.wsj.com/articles/equifax-sent-lenders-inaccurate-credit-scores-on-millions-of-consumers-11659467483

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