Pub. 7 2017-2018 Issue 1

O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G C O L O R A D A N S R E A L I Z E D R E A M S July • August 2017 13 Bureau Reporting Changes BY CHANCE WILLIAMS, CRCM, COMPLIANCE SPECIALIST E xperian, Equifax, and Transunion (the Bureaus) have announceda change in theway that theywill be reporting credit for consumers on July 1, 2017. The changes being madewill affect the credit reportingofmost, if not all, Civil Judge- ments and Tax Liens. The Bureaus are raising the standard for Personal Identifying Information (PII) required when reporting Civil Judgements andTaxLiens against consumers. TheBureaus expectedthechanges toaffect8-10%of all credit reportsandcould result in inflated scores for these borrowers. 64 % of consumers with tax liens have just one tax lien and 69% of consumers with civil judgements have just one judgement against them; however there are situations that could arisewhere a consumer hasmulti- ple liens and /or judgements that will no longer be reported. The NationalConsumerAssistancePlan(NCAP) encompassesaseries of initiatives designed to strengthen the quality of credit reports. The plan is to make consumer reports more transparent, easier foraconsumer tounderstand, andensureaccuracyandtimeliness of data maintained in the reports. The other side of the coin is the impact on the financial industry in relation to making safe and sound credit decisions when using the revised reports. The revised reports will require the financial industry to take a more proactive approach when it comes to evaluating a consumer’s credit worthiness. Banks and other institutions have relied on consumer credit reports for years whenmaking a determination about the likelihood of a consumer repaying a credit obligation. The days of being able to rely on consumer credit reports to tell the whole story has come to an end. Banks and other institutions will now need to have a more robustunderwritingsysteminplace toaddressaconsumer’s predictive behavior. While the reporting change will affect a small portion of the reports beingpulledand reviewed itwill have the greatest impact for those who have marginal credit scores. FICO believes that   continued on page 14