Throughout the years we have seen audits conducted by the repositories that result in the termination of that broker or lender’s access to credit reports.
These audits are usually triggered by borrowers, who at the recommendation of a credit repair company have frivolously disputed items on their credit report that was provided to them by a mortgage broker. The repositories monitor patterns on disputes they receive and match them to recent inquiries on the consumer’s credit report.
All three repositories (Experian, Trans Union and Equifax) publish a monthly list of mortgage companies (and individuals) which are barred access to credit data through every credit reporting agency.
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Important information for mortgage professionals!
You should always talk to your credit reporting agency before recommending to your clients that they dispute something on their credit report (either directly or through a credit repair company) for the following reasons:
- When you look at a tri-merge report you can not tell what is actually being reported by each bureau because the information has been merged. It could be the merge logic used to produce the report might be responsible for the error in which case no dispute would be necessary.
- When you borrower disputes a tradeline, that account is locked from any further actions until the dispute is resolved. It may have been possible, through rescoring; to correct the item in as little as 72 hours, but once the account is locked this is no longer a possibility.
- It is possible that removing an item (even a derogatory item) could cause a negative impact on the score or could even cause you to lose the score completely. This is especially true if the item was one of the minimum requirements used to produce the score. Unless you are absolutely certain of what you are dealing with it is always best to consult with your credit reporting agency to confirm what you are doing will have the desired results on the credit score.