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The last decade was a tumultuous financial period for Americans.
In the mid-to-late 2000s, economic activity declined rapidly and marked the largest downturn since the Great Depression. It is estimated that Americans lost nearly $16 trillion of net worth during this time. To make matters worse, unemployment rates doubled. The booming U.S. housing market plummeted along with the stock market which caused a chain reaction in exposing significant flaws within the financial ecosystem.
Buying a home is one of the best times to know about your credit. According to a recent survey by Experian, many of those in the market for a home already know the wisdom of credit score insight. However, only half of recent buyers said they checked their credit when they first considered purchasing a home.
The following article is a guest post from, John C. Linfield, Executive Director at the Institute for Financial Literacy
At the end of “Financial Literacy Month” here in the United States, it seems appropriate to take a moment and think about why we should become financially literate, and how we can use that to stay on track for the long term.
People are making a big deal about big data—and it is a big deal.
It has the power to guide us in addressing some of our nation’s most pressing needs, from protecting against fraud at the checkout counter to helping families secure affordable loans that help them accomplish their dreams. And like any powerful tool, it must be deployed wisely; in the wrong hands, as Hollywood saw recently, data can be hacked.
Do you know the requirements of Fair Credit Reporting Act (FCRA) section 623? How accurate is your data? How do you know? These are the questions data furnishers should be asking themselves as they start thinking about how to meet their regulatory obligations related to data accuracy. Minimizing regulatory risk and exposure is certainly top of mind for anyone that is engaged in the credit eco-system – the lender, the credit bureau, the consumer. While heavy fines and penalties can take a toll on an organization’s checkbook, the reputational impact to the company’s brand and customer experience can have a lingering, and often worsening, effect. It’s important to think about the consequences of inaccurate credit data from the consumer perspective; inaccuracies can have an impact on a consumer getting a job, buying his or her first home, or getting a low interest rate. Experian® understands the value of an accurate credit report. We have the ability to help data furnishers not only understand regulatory requirements, but help to drive a positive experience for the consumer through Experian Data Integrity ServicesSM. Hear more about our products and services that provide robust data-quality analysis. What do the FCRA furnisher rules really mean? Why does it matter? The Fair Credit Reporting Act (FCRA) section 623 mandates that when providing consumer credit information to the credit bureaus, data furnishers (regardless of size) must ensure accuracy and completeness. Without this, financial institutions will experience more regulatory pressure, higher dispute volumes and unhappy customers. While ensuring data accuracy and completeness may seem like a very broad mandate that can be a bit overwhelming, Experian can help. The first step to compliance is to understanding what the rules mean and the reasons behind them. During our Vision 2015 session, Experian will break down section 623 of the FCRA and describe the specific obligations of data furnishers related to sending accurate data to the credit bureaus, correcting errors, and what it means to investigate and understand disputes. See Experian Data Integrity Services in action during a live demo of our dashboard which provides financial institutions with a deeper understanding of their disputes and how they compare to their peers and the industry. Not only has the FCRA set requirements on dispute investigation and response, but the Consumer Financial Protection Bureau (CFPB) also is paying close attention. Recent announcements indicate that the CFPB wants more information about the credit eco-system to gain more data about consumer disputes. At Experian we understand the complexities that exist with a dispute and partner with financial institutions and regulatory agencies to shed more light on why a consumer disputes data on their credit report and how together we can resolve the issues and improve the customer experience. Join this Vision 2015 session to hear about Experian’s National Credit Assistance Center (NCAC) and how the team assists consumers with disputes and dedicated fraud assistance. Our agents had conversations with consumers more than 2.5 million times last year. The NCAC’s highly skilled and knowledgeable agents know that their role goes beyond processing disputes — it has been proven that educated consumers are more creditworthy and have higher credit scores than those without credit education. For that reason, for many years our center has employed a Stop the Clock philosophy where agent performance is measured on how well he or she assists a consumer and not how long a call takes. Our agents understand that calling a credit bureau can be intimidating so they deliver red carpet service,—making sure the consumer understands the process and walks them through any concerns and questions they have about their credit report. When it comes to data accuracy, the NCAC management team has more than 100 years combined of credit bureau experience and is dedicated to working in partnership with data furnishers in data accuracy and dispute processing initiatives. They routinely work with data furnishers on issues such as training, processes and procedures and offer consultative expertise. Hear more about how the NCAC makes a difference for Experian’s clients and for their customers. Remember… Data accuracy is more important the ever. Get a copy of the FCRA booklet, read about data-furnisher obligations, and start testing and sampling data right away. Learn more about how Experian Data Integrity Services can help validate data accuracy and provide insight into disputes. Consider visiting the NCAC to see firsthand how the Experian team assists with disputes, truly “stops the clock,” and goes above and beyond for our clients’ customers.
The following article is a guest post from Laura Levine, president and CEO of the Jump$tart Coalition for Personal Financial Literacy®
As we wrap up another Financial Literacy Month, it’s fun to look back at how far we’ve come; important to look forward at how much further we have to go; and compelling to look closely at how we’re making a difference.
Millennials are considered the “Me Me Me” generation. Why shouldn’t they be? Aged 18–34, millennials have everything going for them in today’s economy. The job market is favorable, and as the creators of advancing technology, they’re poised for growth. According to the U.S. Census Bureau, the “millennial” generation is projected to surpass the outsized baby-boomer generation this year to be the nation’s largest living generation. How are millennials handling credit? This is a generation unique in its behaviors and mindful of its financial position going forward. The choices millennials make as they enter their peak spending years will have a direct impact on the credit market. This is a ballooning opportunity for lenders, and it makes sense for marketers to design their brand experience to target this generation. However, lenders need to understand what appeals to millenials to reach this group. As part of our upcoming Vision 2015 session, we’re giving lenders the analytical insight they need to understand this generation better. This session will explore housing, auto, bankcard and student loan trends in credit establishment, and how millennials compare to Gen X when they were the same age. Our analysis shows that millennials haven’t fully embraced credit. They understand the importance of building credit; however, they’re adopting bankcards at a slower rate than their Gen X counterparts when they were the same age. Forty-six percent of Gen Xers had bankcards when they were 18–34 years old. On the other hand, 27 percent of millennials have bankcards, which is half the rate of the previous generation. Every generation is different and every business is trying to capture the millennials’ attention. How should lenders go about building trust and a lasting relationship with millennials? We took to the streets to speak to millennials firsthand to give you an opportunity to hear their perspective. Come join us to discover “Four great insights about millennials in 40 minutes” and rethink how you can reach millennials at the right time with the right message.
For years, brands lacked the means to create highly relevant and meaningful interactions with their customers. Today, that has changed--and the demand has never been greater. According to Experian Marketing Services’ State of Cross-Channel Marketing Report, marketers from around the world are adopting more customer-centric engagement strategies. With cross-channel marketing technology and predictive analytical tools becoming smarter and more accessible to marketers, they have the ability to help brands manage data, understand the preferences of their customers and most importantly, turn that intelligence into action across every channel at scale.
Eighty-eight per cent of Australians say day-to-day expenses, rent or mortgage repayments, groceries and bills, are the most common roadblocks to paying down debt, according to new research by Experian, the global information services company. Experian research also showed 65 per cent of Australians incorrectly believe contributing to superannuation or saving money can have a positive impact on your credit score. Andy Sheehan, Managing Director of Credit Services at Experian said the figures not only highlight a knowledge gap when it comes to understanding credit worthiness but also the difficulty Australians face in paying down debt as the cost of living continues to rise1. “Australians are more reliant on credit now than ever before. The Australian Securities and investment Commission noted recently that the average Australian credit card debt in 2014 was more than 30 per cent higher than the year before,” he said. “We know that the most effective way to manage credit card debt is to pay it off in full each month however, we also know that many of us are aren’t able to manage our debt in this way2. Our research suggests that about 19 per cent of Australians pay only the minimum repayment on their credit card and five per cent of those people prefer to put extra cash in savings instead of paying down their debt. “How we manage debt has a major impact on our life. While saving is important, it’s also important to make paying down debt one of your priorities,” said Sheehan. Unsurprisingly, one in three Australians who participated in the survey (33 per cent) said they were nervous about their ability to access and manage credit and according to the research, their concerns are justified. Sheehan explained there is a significant lack of consumer understanding about the behaviours that impact creditworthiness, particularly when it comes to savings and superannuation. “Australians are too busy ‘getting by’ to worry about their creditworthiness. Our research shows that Australians are alarmingly misinformed when it comes to credit reports. In overseas markets, consumers are more empowered to take charge of their credit profile, actively manage their credit reputation and use it to get a better deal. In order for this to become the norm here, Australians need to be better informed and more proactive with their credit reputation,” said Sheehan. The new figures show we still have a long way to go. The research shows that only 23 per cent of Australians actually understand what a credit score is and how it is used by lenders to grant credit. Sheehan said comprehensive credit reporting was a step in the right direction as it will encourage people to become more aware of their positioning in the credit landscape. “Comprehensive credit reporting is good news for consumers. The negative credit reporting system doesn’t take good credit behaviour into account. Australians deserve to be recognised for good financial behaviour and this should be reflected in our credit report to enable better deals,” explained Sheehan. Additional findings from the research show: A further 19 per cent of Australians incorrectly believe that having multiple lines of credit open can positively impact their creditworthiness 40 per cent of Australians have up to three lines of credit available to them that they use infrequently 60 per cent of people said their bank is meeting or exceeding their expectations on providing information about their credit profile, compared to just 45 per cent in February 2014 People should also be aware that they can access their credit reports from Experian for free at any time. It is a good idea for them to do this to help prevent identity theft and confirm the accuracy of their credit history. Consumers looking to receive a copy of their free credit report and score can do so by visiting the Experian Credit Services website or for general service enquiries consumers may call Experian Credit Services on 1300 783 684.