What Happened to Companies Doing Their Jobs When It Comes To Your Credit? Another reason to stay on top of your credit reports!

     If you think managing your credit and your finances is easy, guess again. And if you think that people you have credit with will automatically report correct information on you, you might be mistaken. MOST of the time your creditors are pretty good but you need to stay vigilant and here’s a great example.

 There are typically three trade lines that credit scoring models like to see to maximize your credit score. Revolving accounts which are your credit cards, unsecured notes from financial institutions and store credit cards with changing monthly payments account for about 30% of your credit score. The other two trade lines are important to your credit score too but not to the extent of revolving trade lines. They are: installment notes which are usually secured by some asset with a fixed monthly payment and mortgages which are also secured by your home with fixed monthly payments over the life of the loan or a fixed period of time. It is a mortgage line that we will talk about today and why it is important to keep tabs on what your mortgage company is reporting about you.  Keep in mind that a maximum high credit score is more likely when you have a all three trade lines of credit; revolving, installment and mortgage.

We had a client pull all three credit reports because we discovered previously that his mortgage company had suddenly stopped updating his mortgage information, balances, payments and payment status over the last six months.  This interestingly coincided with their work on a loan modification for him.  When the modification was approved, the monthly update reporting to the credit bureaus stopped. His information was old and balances higher than they currently were. The client tried to call his mortgage company to ask them to get this updated, found he was only able to speak to their outsourced customer service department and was told he would have to write a letter to their “Research Department”.  So he did that and got no reply.  When we looked at his new reports we found that indeed, the information had been updated on two of the credit bureaus, Experian & Equifax but the Trans Union report did not have the mortgage lines listed.  Trans Union’s report indicated that his score would benefit by having a mortgage but he DID have a mortgage, it just was not showing up therefore his credit score was not maximized and lower than it would have been with the mortgage information.

 TRANS UNION SIDE:Two phone calls to Trans Union yielded the same information.  They told us that for some reason, when the mortgage company reported their information, (yes Trans Union could see it in their file on the client) the mortgage company itself had highlighted the account for suppressing to any outside request for the report.  In other words, if a creditor was to run our client’s Trans Union credit report, the mortgage information would not be included and his score would reflect that..  According to Trans Union that is only a command the credit reporter controls when they send in information.

 MORTGAGE COMPANY SIDE: When calling the mortgage company’s over-seas customer service, we were told that the mortgage company would not suppress anything and only reports the balance and the status of the account.  After a final call to the mortgage company’s customer service line and arguing with very nice customer service reps who read from scripts, we decided the only thing we could do was to fax the “Research Department”as suggested and tell them that apparently someone who was updating our client’s files after letting the ball drop for six months had possibly had forgotten to “unsuppress” the information they reported with Trans Union.

THE MIDDLE: Our client was in the middle of all this trying to get his mortgage company to correct its apparent mistake while the credit reporting agency insisted it was not their doing and only the mortgage company could fix the problem.  Trans Union did suggest having the mortgage company call their Trans Union sales rep to determine the problem, so that is what we requested the mortgage company do in our fax.  If there is anything to be learned from this, it is to be on top of your credit reports and the information in them, hold your creditors accountable for the information that is or isn’t in your file or showing up on your report, don’t be afraid to ask help from the credit bureau in question and be ready to be persistent until resolved because most likely you will be managing two companies who merely point the finger at one another instead of digging into the problem.  You are the owner of your own information so make sure it is right and accurate.  Don’t take no for an answer and follow up.  If we hadn’t pulled this report and noticed the discrepancy or talked to both sides, this situation would have never been resolved.  The consequence of not finding this issue could be the difference on paying higher interest rates or even approval from a potential creditor since the mortgage lines were suppressed from the report and the score.