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Credit rating company Equifax provided inaccurate scores of up to 25 points on MILLIONS of Americans

Equifax, one of America’s top credit rating companies, incorrectly scored millions of Americans seeking loans between March and April.

The company, which maintains credit reports on more than 200 million consumers, sent inaccurate reports that differed by up to 25 points for consumers applying for auto loans, mortgages, and credit cards. The Wall Street Journal reports.

Bank executives and others familiar with the errors said the inaccurate scores were enough to change the interest rates available to consumers, while others were rejected from applying for the loans altogether.

Equifax said the issue, which was attributed to a “coding issue,” has been resolved and the outage did not affect the vast majority of consumer credit reports.

“We found that there was no shift in the vast majority of scores during the three weeks of the issue,” Sid Singh, president of Equifax’s US Information Solutions, said in a statement.

“For the consumers who did experience a score shift, an initial analysis shows that only a small number of them have received a different credit decision.”

Equifax gave incorrect credit scores of up to 20 points to millions of Americans seeking auto loans, mortgages and credit cards between March and April

Equifax gave incorrect credit scores of up to 20 points to millions of Americans seeking auto loans, mortgages and credit cards between March and April

Bank executives and other sources claimed that car loan, mortgage and credit card applicants were affected by the flaw, causing their scores to fluctuate between credit ranges and potentially result in them missing out on the best interest rates available.

Bank executives and other sources claimed that car loan, mortgage and credit card applicants were affected by the flaw, causing their scores to fluctuate between credit ranges and potentially result in them missing out on the best interest rates available.

Equifax CEO Mark Begor (pictured) acknowledged the outage in June, claiming it would matter nothing to one of America's top credit rating companies

Equifax CEO Mark Begor (pictured) acknowledged the outage in June, claiming it would matter nothing to one of America’s top credit rating companies

Equifax CEO Mark Begor had acknowledged the outage at an investor conference in June, claiming the impact would be “pretty small” and “not something significant to Equifax.”

However, sources told the WSJ that millions were affected, with a bank official saying as many as 18 percent of applicants had their credit scores affected by 8 points during the three-week glitch period.

Another source told the outlet that a car borrower saw that 10 percent of its applicants had inaccurate credit scores, with several thousand seeing their score affected by up to 25 points.

One source even claimed that a small number of loan applicants went from no credit scores to a score in the 700s and vice versa.

Even the smallest changes can have lasting effects on the interest rates and loans consumers can get. Typically, the higher the credit score, the more likely an applicant will be approved for a loan at a lower interest rate.

Equifax also breaks consumer credit scores into five categories: poor, fair, good, very good, and excellent, and a 25-point change can make all the difference.

If a consumer with an excellent score of 775 were to see his credit rating drop by 25 points, it would put him in the very good category and cause him to miss out on the best interest rates.

Shalomim Halahawi, a rabbi from Georgia, testified to the glitch and said he saw his credit score, which ranged between 811 and 820, suddenly drop to 669 in a day.

“I went ballistic and challenged it and suddenly 809 popped up again,” Halahawi wrote on Facebook. This is with 100% paid bills, mortgage payments, loans, credit cards etc combined for over a decade. Never missed a payment, not even during the Pandemic.’

“I don’t play about my credit score,” he added.

One Twitter user with the handle Emocane said that during the affected period in late March, he also saw a sudden drop in his credit score as he finalized the purchase of his new home.

“I closed my house on March 30th and on March 23rd the lender gave my credit again and magically increased my rate. F*** you @Equifax, I’ll give you these hands in court, f***s.

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Shalomim Halahawi, a rabbi from Georgia, said his credit score dropped from 820 to 669

Shalomim Halahawi, a rabbi from Georgia, said his credit score dropped from 820 to 669

A Twitter user said they saw his mortgage interest rate rise after their credit score was checked during the affected period

A Twitter user said they saw his mortgage interest rate rise after their credit score was checked during the affected period

Lenders are now scratching their heads over how to fix the problem, with some considering giving consumers new loans to get better interest rates and allowing those who were rejected to reapply. reported the WSJ.

“We are not taking this issue lightly,” Singh said in a statement, adding that Equifax was working with lenders on a solution and provided updated credit information.

Immediately after news of the gaffe, Equifax saw its stock plunge 2.12 percent on Tuesday, closing at its first low since the stock rose sharply last week.

Shares of Equifax fell 2.2 percent on Tuesday after reports of the credit failure

Shares of Equifax fell 2.2 percent on Tuesday after reports of the credit failure

This isn’t the first time Equifax has run into trouble. In 2017, the credit rating giant fell victim to a hack that exposed the personal information of nearly 150 million American consumers.

The breach led to the ousting of former CEO Richard Smith after regulators determined the company had not taken basic steps to protect consumer data, forcing Equifax to pay $700 million in fines.

The outage is likely to put Equifax in trouble with the Consumer Financial Protection Bureau, which regulates America’s top three credit reporting companies – Equifax, TransUnion and Experian.

The agency is currently investigating how the three companies are handling consumer disputes after the companies agreed to remove tens of billions of dollars in medical debt from consumer credit reports.

This is a story in development.

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