TO THE EDITOR:
I see lenders defaulting to a scorecard system, relying on the predictability it provides (“Finance industry sues to overturn CFPB arbitration rule,” autonews.com, Sept. 29). I can see the logic behind that, but only if the credit reporting agencies are held accountable for the credit scores their systems assign each consumer. The agencies profit from those scores by selling them to consumers — scores that are useless, but the average consumer is unaware of that until the consumer’s report is run in the prospective industry in which credit is sought. I have yet to find an industry in which the score sold to the consumer was accurate. If each industry has its own scorecard, why isn’t the consumer given all the scores in each industry?
I would think that a class-action suit would be appropriate for lenders, consumers and vendors whose business is being forced to rely on credit agencies’ scorecards. One may argue a company’s internal scoring comes closer to credit performance than all three agencies’. It seems logical to use the data within the lender’s own pool rather than an obviously inaccurate score from all three bureaus.
We talk about transparency and accountability, but how long have credit agencies been playing the “we are not responsible for the information we report” card? They are not being held accountable for information so many rely on to make a sometimes life-changing decision. The lenders are hurt by having to rely on them to grant credit, even if they see the score doesn’t match the credit performance.
D. AMARAL, Anaheim, Calif. The writer has worked in indirect lending for 20 years.