Credit Controversies

Controversies over credit scoring continue to rage. Here are just of few of them.

Credit Scoring’s Vulnerability to Errors

No matter how good the mathematics of credit scoring, it’s based on information in your credit report—which may be, and frequently is, wrong. Sometimes the errors are small or irrelevant, such as when your credit file lists a past employer as a current employer. Other times the problems are significant, such as when your file contains accounts that don’t belong to you. Many people discover this misinformation only after they’ve been turned down for credit.

The credit bureaus handle billions of pieces of data every day, so to some extent errors, outdated information, and missing information are inevitable—but the credit-reporting system often makes it difficult to get rid of errors after you spot them.