WASHINGTON, D.C. - With the economic hardships of the pandemic, consumer advocates say credit is as important as ever, but getting more and more complicated for Americans to navigate.
It's estimated one in five credit reports contains an error, and errors which impact someone's credit score and financial future disproportionately affect Black, brown and Indigenous consumers.
Liz Shrum, senior advisor and spokesperson for the American Association of Consumer Credit Professionals (AACCP), pointed out more Americans are still losing their jobs than before the pandemic, nearly four million homeowners are past due on their mortgages, and one in five renters is behind.
"For decades, American consumers have expressed frustration in dealing with the complex and confusing credit reporting system," Shrum observed. "The unprecedented crisis that we now find ourselves in only added to that confusion."
Consumer credit professionals in the newly-formed AACCP work to help folks navigate the credit reporting system to identify and fix any potential errors, as well as make sure they're accessing loans and mortgages at reasonable rates.
As the pandemic hit hard in April of last year, the Consumer Financial Protection Bureau relaxed rules which require credit reporting agencies to respond to complaints of errors within 30 days. Meanwhile, there's been an increase in those complaints.
Shrum noted because credit report errors impact more people of color, it's yet another structural barrier to economic equality.
"The hard hit are underserved communities, minorities," Shrum contended. "And those communities are oftentimes hit harder during challenging economic times as well."
Shrum added people deserve the best tools to ensure their credit reports are accurate, so they don't have undue barriers to future financial opportunities, especially those who may not otherwise be able to afford attorneys or financial advisors.