A critical number
Read my op-ed in The Hill about my bill to give Americans free access to their credit scores.
A critical number
By Sen. Mark Udall
Last week, Senator Lugar and I, along with eight of our colleagues, introduced the Fair Access to Credit Scores Act of 2010. This bill is a common-sense way to empower consumers to take responsibility for their finances - by offering Americans annual access to their credit score when they access their free annual credit report.
In 2003, Congress enacted legislation requiring the three major consumer credit reporting agencies to provide a free annual credit report to consumers. A credit report tells consumers what outstanding credit accounts they have open, like student loans, credit cards, and perhaps a car or home loan, but it tells them little else. And they often, hopefully, already know the kind of information contained in their credit report.
A credit score, on the other hand, is the critical piece of information that impacts interest rates, monthly payments on credit cards and other loans. It can be the difference between whether a child can afford college - or whether a potential homeowner can get a mortgage. And it can even affect a consumer's ability to buy a car, rent an apartment or get phone or Internet service.
Everyone has seen the frequent television commercials or Internet ads, which incorrectly lead viewers to believe the free annual credit report required under law includes a credit score. In reality, consumers have to jump through hoops and ultimately pay for a score or subscribe to a credit monitoring service that can cost nearly $200 a year. Banks and lenders can easily obtain these scores, while the consumer themselves seem to be the only ones who do not have easy access to it.
In the most troubling cases, consumers often believe they are signing up to get a free credit score, only to find out later they unwittingly signed up for this costly monthly monitoring service. Put simply, our bill accomplishes what the television commercials and their fine print caveats have deceptively claimed to offer for years - a free credit score.
If we want to empower Americans to help shape our financial future, we have to start with a dose of transparency. While free access to a consumer's credit score is only a small part of the larger reforms that are needed, it addresses one of the fundamental inequities that pervade the current financial system.
When so much is at stake, this legislation is a small step that will help restore balance and put Americans back in control of their financial health. My hope is that as this chamber considers the Wall Street accountability bill, we will consider adding this legislation as an amendment - to restore an even greater dose of fairness to consumers in Colorado and all around the nation.