Le score de millions d'emprunteurs a pu varier de plus de 20 points.

The United States: When a Computer Error Prevents Families from Borrowing

This is the absolute sesame for American families when they want consumer credit: the degree of sacred risk, which determines whether or not they can be given financing. However, one of the major companies responsible for rating Americans – Equifax – is said to have made a fatal mistake last spring, lowering the rating of millions of borrowers. An error that could have been the cause of many credit denials in the United States.

The scenario may be startling, but it seems increasingly plausible for clients evaluated by Equifax: According to information from the Wall Street Journal, in mid-March the US credit rating giant could have sent false information to the banks that consulted it.

the reason ? A computer coding error occurred in the Equifax rating system between March 17 and April 6. This could have resulted in a rating change for millions of clients, whose borrower scores may have seen differences of more than 20 points, both up and down.

Risk to accessing credit

On a scale of 850 points, this change is only real stories for potential borrowers. The reason may be the increased cost of credit, or even, quite simply, the refusal to grant loans by banking institutions, which systematically use such rating systems to assess the solvency of borrowers.

Use of consumer credit is more frequent among households on the other side of the Atlantic: According to figures from the Federal Reserve, loans outstanding excluding mortgages totaled nearly $4,500 billion in the second quarter of 2022, about a quarter of all loans. For individuals (consumer loans and mortgages). In France, “consumer credit” weighs half as much, about 13% of the total credit given to households.

Thus, between March 17 and April 6 alone, 2.5 million credit scores could be required by banking institutions in order to grant loans. However, it is difficult to know what share of these scores fall under the Equifax scoring system.

Less than 300,000 affected accounts

For its part, the evaluation firm asserted in a press release that “less than 300,000 consumers would have seen a variance of 25 points or more.” and to specify that “if the rating were modified, it would not have a systematically negative impact on the decision to grant credit to the consumer.”

Arguments that do not, however, succeed in pacifying clients who consider themselves aggrieved. This topic stirs up the American mainstream media (Fox, CNBC…) which shows on their websites for their listeners to check whether they are affected or not. The day after Equifax became aware of the computer error, a class action lawsuit was filed in Georgia by a Florida citizen. It believes the company has violated the “Fair Credit Reporting Act,” the law that governs consumer ratings.

The complainant claims that due to Equifax’s error, her credit score deviated by 130 points when she applied for a car loan, resulting in a rejection. After that, she had to take out another loan that cost her an extra $150 a month. It now remains to be seen if other deceived consumers will come forward.

But far from this case, Americans can rejoice that their credit scores have improved somewhat in recent years. According to a study conducted by the Federal Reserve Bank of New York and published on Tuesday, thanks to a moratorium granted to borrowers during the health crisis, household solvency has improved significantly: Across the Atlantic, about 30 million people saw their risk profile improve at the end of 2021, the institution confirms.

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