Oakland couple denied refinancing based on credit report error

Friday, June 23, 2017
Oakland couple denied refinancing based on credit report error
7 On Your Side explains why you need to monitor your credit report.

OAKLAND, Calif. (KGO) -- A federal study found roughly one in five consumers discovered errors in their credit report that were eventually corrected. An error on your credit report can reduce your score and lessen your chances of getting a good loan.

Oakland residents Henrietta and Ronald Fabio know that firsthand. They applied to refinance their mortgage at the beginning of the year but were denied.

Their credit report listed a second home the couple owned as a foreclosure. The Fabios say their credit report had not been properly updated.

"The foreclosure never went through. It was a notice of default," said Henrietta.

Bank of America filed that notice of default in 2012. It put the couple on notice to bring their loan up to date or face foreclosure. The couple received a modification and by 2013, the notice of default had been rescinded.

But as early as this year, their credit report from Transunion still listed the home as a foreclosure. "Everybody kept saying you had a foreclosure on your record," said Ronald.

Transunion was the only credit bureau that listed a foreclosure. "It's very unsettling. It's unsettling though you have proof it didn't happen," Henrietta said.

That's why it's highly recommended that you monitor your credit report for errors. You can take advantage of a law that requires each of the three credit bureaus to give you one free credit report each year.

Besides Transunion, there are Experian and Equifax. That means every four months, you can request a new and free credit report -- one from each of the three bureaus.

To request yours, you can click here.

Henrietta says the couple sent Transunion proof their home had not been foreclosed but nothing changed.

Suzanne Martingdale is with Consumers Union and described what happens when you dispute an error in your credit report. "Their process may be relatively automated, they may be checking boxes. If they check their records and it appears the information may be still accurate, they may not do anything, so you may need to be persistent," she said.

The couple wasn't ready to give up. "For me, I'm thinking I'm going to find a way. I'm just that type of person. I'm not going to give up," said Henrietta.

That's why she paid us a visit at our Ask Finney event in Alameda. She talked to one of our counselors and we contacted the credit bureau.

Transunion said, "Discrepancies potentially can result from a number of factors, such as identity theft, a disagreement between a consumer and their creditor, or a data entry error somewhere along the way."

The couple says within a week, the foreclosure was removed from their credit report. Henrietta was happy she paid me a visit. "Thank you, Michael, and thank you for advertising that you were going to be there. And it was just so simple. "

Our next Ask Finney event is scheduled for July 14 at the Town Center in Corte Madera. As for the Fabios, they say they are well on their way to getting their mortgage refinanced. By refinancing, they say they will save $36,000 annually.