Wednesday, August 02, 2006



D from London (in blog comments):
Jill said that if you believe a company has posted incorrect information on your credit file and you can't get the company to correct it - that they'll put a note on your account saying you dispute the information. How much use is this? Will banks doing credit checks really take the slightest bit of notice of your comments?

Yes. Banks and other lenders have to take note of disputes and other notes that consumers can add to their credit reports. If there is a dispute flag on a piece of information, the credit application is referred out of any automated decision system and the lender has to make a "manual decision".

The dispute flag system was introduced with the new Data Protection Act so legislation dictates how lenders can use the information that we provide them with.

"automated decision system" - what's that?

Most lenders use computerised systems to process applications for credit. These sophisticated computers "score" each piece of information and come up with a yes/no/maybe.

So - you provide the information, the banks etc make the decision - based on your information?

Yes but they also feed into their scoring systems any information you give them that is not on your credit report, for example your job, your residential status, how much you earn etc.

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