How important is it to know your credit score? Experts tend to agree that it’s significantly important for the sake of protecting your power to purchase the essential things of life. We’re talking home mortgages, car loans and more.
But, according to the federal Consumer Financial Protection Bureau, most consumers don’t have a clue what their score is on any given day and only about 20 percent of consumers take advantage of the one free review of their score that credit reporting companies are obligated to provide. Very few are willing to pay a monthly fee for the privilege.
The head of the CFPB, Richard Cordray, says that as a result of that gap consumers often don’t find out about issues with their credit scores until it’s too late. The first flags only go up after a credit application has been rejected or one’s rating has been eroded by identity theft.
To be sure, there are solutions available for individuals in Arkansas who need help with debt management issues. An attorney with particular experience in this area can be a significant help assessing all the options.
But Cordray suggests there’s a way to provide consumers with more preemptive power. He recently sent letters to credit card companies strongly urging them to start including customers’ credit scores on billing statements or online. He says the steady flow of information will allow consumers to spot problems earlier and act faster to correct them.
Consumer groups give the idea high marks, though they say free disclosure should be mandatory, not optional.
Bankers seem more cautious. Some banks already offer free credit score reports to their customers, but some spokesmen for industry groups suggest the CFPB’s letter amounts to undue pressure on banks to comply. They say they’d rather let the marketplace dictate the solutions.
Source: McClatchyDC, “Consumer bureau urges companies to offer free credit scores,” Lindsay Wise, Feb. 27, 2014